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McDonald's sells Singapore franchise to Saudi group
The deal covers 390 restaurants, including those in Malaysia.
McDonald's Corp. revealed that it has selected Lionhorn as the Developmental Licensee (DL) for its Malaysia and Singapore markets.
Lionhorn is led by Sheik Fahd and Abdulrahman Alireza, who bring 20 years of experience as the DL for the nearly 100 McDonald's restaurants in the Western and Southern regions of Saudi Arabia.
"This transaction marks another milestone in our Company's ongoing efforts to identify strategic partners who share our values and vision to accelerate our growth and scale across diverse markets, drive innovation and place us closer to our customers and the communities we serve," said McDonald's president and CEO Steve Easterbrook.
The new DL assumed ownership of the McDonald's business in Malaysia and Singapore on December 1, 2016, which includes a total of 390 restaurants, more than 80% of which were Company-owned.
The financial terms of the transaction were not disclosed.
Under the DL structure, McDonald's transferred its ownership interest in McDonald's Malaysia and Singapore and granted a license to the DL to run McDonald's restaurant operations in these markets.
The DL partner will provide the capital necessary to support and grow the business and will pay an initial franchise fee and an ongoing royalty to McDonald's.
McDonald's committed to refranchising 4,000 restaurants by the end of 2018 with the long-term goal of becoming 95 percent franchised. With this transaction, McDonald's has now refranchised approximately 1,300 restaurants.
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