The fast-food giant McDonald's has acquired franchise rights from entrepreneur Omri Padan, signaling a search for a new franchisor.
According to the economic publication Calcalist, international pressure, particularly from pro-Palestinian groups, prompted McDonald's to seek control over Israeli branches.
This move allows McDonald's to halt donations to the Israeli Defense Forces (IDF) made by restaurants under Omri Padan's control.
McDonald's entered Israel approximately 30 years ago, currently operating 225 restaurants and providing employment to around 5,000 people. The company assures that worker conditions will remain unchanged post-transaction.
Following October 7 and the war in Gaza, Omri Padan, like other Israeli restaurateurs, began donating meals to IDF soldiers. However, McDonald's faced severe reputational challenges in regions opposing Israel due to its association with these donations. To mitigate financial fallout, McDonald's opted to acquire McDonald's Israel, according to the publication.
In its financial report for the fourth quarter of 2023, the international McDonald's chain cited the Gaza conflict's impact on sales. Reports of Israeli McDonald's restaurants donating food to the IDF prompted calls for a boycott of the fast-food chain in Arab, Muslim, and certain European nations.
Omri Padan, CEO of Aloniel, obtained the rights to open McDonald's restaurants in Israel in 1992, with the first establishment launching in 1993.
