McDonald’s said on Monday it began the process of selling its Russian business, which includes 850 restaurants employing 62,000 people, making it the last major Western company to leave Russia since it invaded Ukraine in February.
The fast-food giant highlighted the humanitarian crisis caused by the war, saying retaining its business in Russia “is no longer tenable, nor in line with McDonald’s values”.
The Chicago-based company announced in early March that it was temporarily closing its stores in Russia but would continue to pay its employees. On Monday, he said he would seek a Russian buyer to hire those workers and pay them until the sale closes.
He did not identify a potential buyer.
CEO Chris Kempczinski said the “dedication and loyalty to McDonald’s” of employees and hundreds of Russian suppliers made the decision to leave difficult.
“However, we have a commitment to our global community and must stay true to our values,” Kempczinski said in a statement, “and our commitment to our values means we can no longer shine the arks there.”
As it tries to sell its restaurants, McDonald’s said it plans to start removing golden arches and other symbols and signs bearing the company’s name. He said he would keep his brands in Russia.
Russia’s first McDonald’s opened in central Moscow more than three decades ago, shortly after the fall of the Berlin Wall. It was a powerful symbol of the easing of Cold War tensions between the United States and the Soviet Union.
McDonald’s was the first American fast food restaurant to open in the Soviet Union, which would collapse in 1991.
McDonald’s decision to leave comes as other US food and beverage giants, including Coca-Cola, Pepsi and Starbucks, have suspended or closed operations in Russia in the face of Western sanctions.
Companies ranging from British energy giants Shell and BP to French carmaker Renault have withdrawn from Russia, dealing a hit to their results as they seek to sell their holdings there.
Other companies have remained at least partially, with some facing a backlash.
McDonald’s said it expected to take a profit charge of between $1.2 billion and $1.4 billion for leaving Russia.
Its restaurants in Ukraine are closed, but the company said it continues to pay full salaries to its employees there.
McDonald’s has over 39,000 locations in over 100 countries. Most are owned by franchisees – only about 5% are company owned and operated.
McDonald’s said leaving Russia would not change its forecast to add 1,300 net restaurants this year, which will contribute about 1.5% to company-wide sales growth.
Last month, McDonald’s said it earned $1.1 billion in the first quarter, up from more than $1.5 billion a year earlier.
Revenue was nearly $5.7 billion.