(Photo by Alan Pitton/Nurfoto/Getty Images)
McDonald's has announced that it will acquire the 30-year-old Israeli franchise from Aronyar, taking back ownership of 225 restaurants that employ more than 5,000 people.
The U.S. fast food chain has been the target of boycotts and protests since Aronyar announced it would donate free meals to Israeli troops shortly after the Oct. 7 attack by the Palestinian organization Hamas.
Although McDonald's is a global company, its franchises are often locally owned and independently operated. CEO Chris Kempczinski previously said the conflict between Israel and Hamas had caused the company to experience a “material impact on its business” in several markets in the Middle East and some markets outside the region. He said that it affected him.
“For more than 30 years, Aronyar Limited has been proud to bring the Golden Arches to Israel and serve the community,” Aronyar CEO and owner Omri Padan said in a statement Thursday.
McDonald's added: “We remain focused on the Israeli market and remain committed to ensuring a positive experience for our employees and customers in our market.”
When the transaction closes in the coming months, McDonald's will own the Aronñal store and operations while retaining its employees. The companies did not disclose the terms of the transaction.
“It's a human tragedy.”
Kempczinski said in February that the war had had a “disheartening” impact on sales in Middle Eastern countries and Muslim-majority countries such as Malaysia and Indonesia.
“As long as this conflict, this war, continues, I don't expect to see much improvement in this situation,” Kempczinski said on a conference call.
“I think this is a human tragedy and what's going on and that weighs heavily on brands like ours.”
From October to December, the fast food chain's Middle East, China and India division's sales growth rate was just 0.7%, well below market expectations of 5.5%.
The recession was caused by customers in Islamic countries calling for a boycott of McDonald's following Aronyar's announcement, which prompted franchisees in countries such as Egypt, Jordan and Saudi Arabia to distance themselves from donations. and jointly pledged millions of dollars in aid to Palestinians in Gaza. .
Chicago-based McDonald's is known as one of the most iconic brands in the United States, but most of McDonald's restaurants around the world are locally owned and operated.
Another major Western fast-food chain, Starbucks, has also launched a boycott campaign over its perceived pro-Israel stance and alleged financial ties to Israel.
CEO Laxman Narasimhan told reporters in February that Starbucks was having a “significant impact on traffic and sales” not only in the Middle East but also in the United States, and that protesters were in Seattle. He said he was campaigning for a showdown with Israel against the company, which is based in Israel.
Domino's Pizza, a U.S.-based pizza maker with franchises around the world, also faced backlash for a social media post alleging without evidence that it had provided free food to Israeli soldiers.
The brand's same-store sales in Asia for the second half of 2023 declined by 8.9%, primarily as consumers in Malaysia associated the brand with the United States, an ally of Israel, the company said. said the person.
