McDonald’s is exiting Russia after 32 years of operations.
The golden arches are coming down in Russia.
McDonald’s Corp. said it has started a process to sell its Russian business, which includes 850 restaurants. The move follows McDonald’s decision in early March to temporarily close its restaurants in Russia and pause operations in the market in response to the country’s invasion of Ukraine.
As a result of its exit from Russia, McDonald’s expects to record a write-off of $1.2 billion to $1.4 billion and “recognize significant foreign currency translation losses previously recorded in shareholders' equity. “The fast-food giant opened its first restaurant in Russia in 1990, in Moscow.
“The humanitarian crisis caused by the war in Ukraine, and the precipitating unpredictable operating environment, have led McDonald's to conclude that continued ownership of the business in Russia is no longer tenable, nor is it consistent with McDonald's values,” McDonald’s said in a statement.
McDonald’s wants to sell its entire portfolio of restaurants in Russia to a local buyer. To prep for the sale, the company said it will "de-Arching" its Russian locations, which entails no longer using the McDonald's name, logo, branding and menu. The company said it will keep its trademarks in Russia.
McDonald’s has some 62,000 employees in Russia. The company said its priorities include seeking to ensure those workers continue to be paid until the close of any transaction and that employees have future employment with any potential buyer.
“We're exceptionally proud of the 62,000 employees who work in our restaurants, along with the hundreds of Russian suppliers who support our business, and our local franchisees,” said McDonald's president and CEO Chris Kempczinski. “Their dedication and loyalty to McDonald's make today's announcement extremely difficult. However, we have a commitment to our global community and must remain steadfast in our values. And our commitment to our values means that we can no longer keep the Arches shining there."
McDonald's restaurants in Ukraine remain closed while the company continues to pay full salaries for its employees in the country and continues to support local relief efforts led by Ronald McDonald House Charities. Across Europe, the McDonald's System is supporting Ukrainian refugees through food donations, housing and employment.