Ramaphosa takes over McDonald’s South Africa

The McDonald’s Corporation has announced the appointment of prominent businessman Cyril Ramaphosa as the development licensee for South Africa. 

McDonald’s South Africa MD Greg Solomon said the local business was strong and robust, and was confident in its future with Cyril Ramaphosa as the new owner. (Image: GovernmentZA, via Flickr)

Brand South Africa reporter
With a 20-year master franchise agreement, Ramaphosa will be responsible for the operation and expansion of McDonald’s restaurants in South Africa.

With some financial backing from the Shanduka Group, Ramaphosa will have to build the McDonald’s brand, grow the South Africa business, and optimise results.

“We’re confident this structure will help us better serve our valued customers in South Africa,” McDonald’s president for Asia-Pacific, Middle East and Africa Dave Murphy said in a statement last week. “The market is award-winning within the McDonald’s system and has consistently produced positive results.

“Ramaphosa is the right person to continue that business momentum, and McDonald’s is committed to providing our ongoing support to this new venture.”

Development licensee model

More than 50 of McDonald’s 117 markets operate under the development licensee model, which has existed for more than 20 years.

Unlike a conventional McDonald’s franchisee, the development licensee owns all the assets in the market, which includes owning and/or leasing the real estate, such as restaurants and office buildings. There is no visible change in the operation of the restaurants to customers.

“It is an honour for me to have been awarded the developmental licence for the McDonald’s South Africa business,” said Ramaphosa. “We will focus on satisfying our customers, developing our people and maximising business opportunities.

“This relationship will have a positive impact on jobs, shareholders and ultimately McDonald’s customers.”

‘Hamburgers as usual’

McDonald’s South Africa MD Greg Solomon said the local business was strong and robust, and was confident in its future with Ramaphosa as the new owner.

“We have an unwavering focus on our strategic business goals and most importantly on our customers,” he said. “For all of our customers in South Africa, it is hamburgers as usual; and for our employees, franchisees and suppliers, it is business as usual, with the benefits of accelerated expansion and responsible growth.”

The transaction is subject to securing the necessary approval of the Competition Commission among other things.

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