The McDonald’s Corporation is preparing to buy out 225 franchise locations in Israel after the local chain became a flashpoint in the Israel-Hamas war by distributing free meals to members of the Israel Defense Force (IDF).
The age of “Golden Arches Conflict Prevention” has ended…McWorld War III has begun.
Current franchise owner Alonyal Ltd, owned by Israeli businessman Omri Padan, first introduced the McDonald’s brand to the Jewish homeland more than 30 years ago and now employs more than 5,000 people. In the wake of the October 7th attacks by Hamas, photos circulated on social media showing McDonald’s locations passing out free burgers to IDF soldiers as retaliatory strikes in Gaza began.
In response, franchise owners in Saudi Arabia, Lebanon, Turkey, and nearly a dozen other Muslim countries denounced the charitable act and donated to Gaza relief funds in what experts called “an intra-corporate proxy war.” Under the McDonald’s franchise model, individual owners act largely independently, and the actions of a particular franchise do not necessarily reflect the positions of the corporation itself.
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The dispute between individual franchises was also accompanied by large-scale public protests and boycotts, with groups of pro-Palestine demonstrators ransacking restaurants in their home countries (ironically targeting locations that did not support Israel).
This wave of negative attention reportedly led to a major slip in McDonald’s fourth-quarter profits in the Middle East, which accounts for two percent of the company’s global sales and one percent of its global earnings pre-tax. These losses have led McDonald’s Corporate to retake direct control of the Israeli franchise.
“We thank Alonyal Limited for building the McDonald’s business and brand in Israel over the past 30 years,” Jo Sempels, president of International Developmental Licensed Markets at McDonald’s Corporation, said in a statement. “McDonald’s remains committed to the Israeli market and to ensuring a positive employee and customer experience in the market going forward.”
Under corporate management, the Israeli franchise’s 5,000 employees will retain their jobs while a new franchise owner is found. Conditions of the buyout were not disclosed.
Connor Walcott is a staff writer for Valuetainment.com. Follow Connor on X and look for him on VT’s “The Unusual Suspects.”
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