Earlier, on January 30, Bakshi, the ousted managing director of Connaught Plaza Restaurants (CPRL), had offered to buy out MIPLs share in the joint venture company that currently operates 154 outlets in northern and eastern India.
In the last hearing, Bakshis counsel had offered to buy out MIPLs stake in CPRL at a valuation based on the net asset value of the company, excluding the value of the McDonalds brand. Responding to the proposal, MIPL had immediately made a counter-offer to buy out the ex-MDs stake at the valuation offered in 2008.
According to the petition filed by Bakshi before the CLB, McDonalds Corp senior official Peter Rodwell had in August 2008 offered to buy out his stake for $5 million. Subsequently, in November 2008, the offer was upped to $7 million. After looking at the mutual buy-out bids by the parties, CLB had directed the lawyers of both sides to seek clear instructions from their clients on whether they wanted to proceed with the stake sale.
The partnership between the US fast-food chain and Bakshi is housed in CPRL, a 50:50 joint venture that was formed in 1995. Bakshis term as CPRLs managing director expired on July 17, 2013. On August 30, McDonalds had issued notices in select newspapers saying Bakshi had ceased to be the MD. In early September, Bakshi moved the CLB for his reinstatement.
Earlier in 2009, Bakshi had called on McDonalds to conduct an independent valuation by a third party and had subsequently enrolled audit firm Grant Thornton to carry out of a valuation of the business. Grant Thornton, in its report, had valued the joint venture company at $331.3 million. CPRL had tangible assets of R102.7 crore as of March 2012 and total fixed assets of R134.25 crore.
While the tribunal had earlier rejected Bakshi's plea, seeking a stay on the foreign arbitration proceedings instituted by MIPL, CLB currently is holding hearings on the allegations of oppression and mismanagement levelled by Bakshi against the fast-food giant.