Burger King’s parent company said it was unable to close 800 Russian restaurants because its joint venture partner “refused”.
Restaurant Brands International (RBI) announced last week that Burger King had stopped all corporate support for the country’s business. This was in response to a host of brands including rival McDonald’s, who sought to cut ties between Russia and Russia following Vladimir Putin’s invasion.
David Shear, RBI’s president of international operations, wrote to employees to highlight the difficulties involved in stopping operations.
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Mr Shear stated that he had contacted the main business operator and requested the suspension of Burger King’s Russian operations.
“He refused to do so.”
Mr Shear stated that it would require the Russian government’s help to enforce its franchise agreements with Alexander Kolobov. However, “we know that this will not happen in practice anytime soon.”
According to Reuters, it wasn’t immediately clear how Kolobov could be reached for comment.
RBI entered Russia in a joint venture partnership a decade ago. It was partnered with three entities: Mr Kolobov who oversees day-to-day operations and private equity asset management firm Investment Capital Ukraine and Russia’s VTB Bank, which has been affected by Western sanctions.
Mr Shear stated that the company is in the process of selling its 15% stake in the joint venture.
He stated that the company wants to do it immediately, but it would take some time based on the terms.
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He stated that there are no legal clauses which allow us to unilaterally alter the contract, or for any partner to walk away from the agreement or to overturn it all.
“Would you like to immediately suspend all Burger King operations in Russia?” In his letter, Mr Shear stated that he agreed.
“Are you able to enforce a suspension or operations today?” No.”