Tags: McDonalds | Russia | Ukraine | sanctions

McDonald's Says Russian Regulator Inspects 100 Restaurants

Friday, 29 Aug 2014 10:52 AM

 

McDonald’s Corp. said Russia’s consumer-safety regulator is inspecting more than 100 of its restaurants after the world’s largest fast-food chain by revenue was forced to close 12 locations in the country.

McDonald’s temporarily closed four restaurants in Krasnodar, in southern Russia, on an order from Rospotrebnadzor, as the agency is known, company spokeswoman Svetlana Polyakova said by phone. Oak Brook, Illinois-based McDonald’s has shut eight other outlets since August 20, including its first and largest location in central Moscow.

The chain, which said it has total of 440 restaurants in the country, has come under pressure amid tensions between Russia and the U.S. and its allies over Ukraine. The U.S. and European Union imposed sanctions against Russian companies and officials, while President Vladimir Putin has reciprocated by banning some food imports.

“It’s Russian retaliation to the sanctions, first it was a ban of food imports and then McDonald’s,” said Sabina Mukhamedzhanova, a fund manager at Promsvyaz Asset Management in Moscow. “This is a prominent symbol of the U.S., it has a lot of restaurants and therefore is a meaningful target. I don’t recall McDonald’s having consumer-safety problems of such a scale in over more than two decades of presence in Russia.”

McDonald’s, which has more than 35,600 restaurants globally, fell 0.5 percent to $94.14 at yesterday’s close in New York. The shares have dropped 3 percent this year.

© Copyright 2015 Bloomberg News. All rights reserved.

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