McDonald's said its "continued business ownership in Russia is no longer viable and not in line with McDonald's values" and is now looking for a local buyer. McDonald's has over 800 restaurants and 62,000 employees in Russia.
McDonald's said on Monday it would sell its business in Russia, just over two months after it suspended operations in the country due to the invasion of Ukraine.
"The humanitarian crisis caused by the war in Ukraine and the worsening unpredictable operating environment have led McDonald's to conclude that continued ownership of the business in Russia is no longer viable and inconsistent with McDonald's values," the company said in a statement.
McDonald’s to sell its Russian business for $1.4 billion to local buyer
Russian forces, led by President Vladimir Putin, are accused of a number of war crimes during their attack on Ukraine. The departure of McDonald's from Russia is the bitter end of an era.
The company, one of the most recognizable symbols of American capitalism, opened its first restaurant in Russia over 32 years ago, as the communist Soviet regime was collapsing and Western business and ideas were seeping through the Iron Curtain.
Hundreds of people lined up to try McDonald's burgers and fries on Pushkinskaya Square in Moscow.
Now McDonald's has more than 800 restaurants and 62,000 employees in Russia.
The company said it is looking for a local buyer.
McDonald's announcement on Monday is a clear indication of how strongly the Western world is opposed to the Putin regime. At first, after Russia's invasion of Ukraine, McDonald's kept quiet about the attack. Then, after public outcry and pressure, McDonald's and major American brands such as Starbucks (SBUX) and Coca-Cola (KO) suspended their business in Russia.
McDonald's said on Monday it will begin the process of "de-archiving" restaurants in Russia, meaning it will remove its name, logos, menus and branding from those locations. At the same time, it will retain its trademarks in Russia, the company added.
The company also said it will try to ensure that its employees in the country continue to receive salaries until the deal closes, and that it will try to help them keep their jobs under the new owners.
McDonald's said its restaurants in Ukraine remain closed, but the company continues to pay full wages to its employees in the country.
Russia and Ukraine accounted for about 2% of McDonald's sales, approximately 9% of revenue, and 3% of operating income.
McDonald's said it expects to record $1.2 billion to $1.4 billion in costs related to its decision to leave the Russian market. The company said in March that its temporary closure would cost it about $50 million a month, or $0.05 to $0.06 per share.
For the first quarter of 2022, McDonald's earnings per share rose to $2.28 and total revenues were $5.67 billion.
Shares of McDonald's, down 8.6% year-to-date, were largely unchanged in early trading on Monday.
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