Buyer of McD's Latin Amer. arm plans $300M overhaul

Nation's Restaurant News,  May 21, 2007  

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BUENOS AIRES, ARGENTINA -- The new owner of McDonald's Corp.'s former Latin American and Caribbean operations, Woods Staton, has pledged to invest $300 million to overhaul the region's restaurants over the next three years.

"The investments will be used to re-style most of the existing 1,600 restaurants and to open as [many] as 60 new restaurants a year," Staton, former president of McDonald's Argentina, was quoted as saying at a press conference here.

Staton's Arcos Dorados SA and a group of private-equity investors paid $700 million last month for McDonald's Corp.'s nearly 1,000 restaurants in the region and for the rights to nearly 600 franchised branches there under a 20-year master franchise agreement that includes a 10-year extension option.

In addition to $700 million, McDonald's Corp. will be paid 5 percent of Arcos Dorados' sales in royalties, Staton was quoted as saying. He forecast that the region's McDonald's restaurants will continue posting double-digit growth. McDonald's Latin American system last year saw sales rise 14.5 percent to $1.66 billion.

McDonald's sold out of the region in the face of currency volatility and in the wake of prolonged legal frictions with Brazilian franchisees.

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