McDonald's Is Selling Restaurants in Latin America and the Caribbean

Filed in archive Latin News on April 20, 2007

From Bloomberg:

McDonald's Corp. reported that first-quarter profit rose 22 percent on Europe's biggest revenue gain since 1994 and said it will sell almost 1,600 restaurants in Latin America and the Caribbean.

The world's largest restaurant company will use the $700 million in proceeds from the sale to a group led by Latin American entrepreneur Woods Staton to raise its dividend and buy back shares. It will take a second-quarter $1.6 billion charge for the transaction, McDonald's said today in a statement.

(...)Revenue climbed 11 percent to $5.46 billion. A new McOriental burger in France and the U.K. introduction of the chicken snack buoyed sales in Europe, McDonald's largest market by revenue. A stronger coffee blend and higher-priced chicken sandwiches and salads lured new consumers.

Apparently, McDonald's restaurants in Latin America are less profitable than other units around the world, and that's why McDonald's is selling them. Anyone dares to guess why this units are less profitable?

A hint: in Latin America you won't lure costumers with higher prices.

Once again, McDonald's shows painfully and clearly the world's disparity.