(Reuters) – More than 30 years after the hugely popular Western fast food chain first came to Russia, former McDonald’s Corp (NYSE:MCD) restaurants are reopening on Sunday under new branding and ownership. This is a new day for Russia’s fast food fans.
On Russia Day, a national holiday that celebrates the country’s independence, the relaunch will start at the same flagship location in Moscow’s Pushkin Square where McDonald’s first opened in the country in January 1990.
As the Soviet Union fell apart in the early 1990s, McDonald’s became a symbol of the end of the Cold War and a way for millions of Russians to try American food and culture. Russia and the West are once again turning their backs on each other, and the brand’s departure is a strong sign of this.
McDonald’s said last month that it would sell its restaurants in Russia to Alexander Govor, one of its local licensees. Since Russia sent tens of thousands of troops into Ukraine on Feb. 24, this deal was one of the most important business moves.
The famous “Golden Arches” of McDonald’s have been taken down in Moscow and St. Petersburg. They will be replaced by a new logo with two fries, a hamburger patty, and a green background. The reopening will begin with 15 places in Moscow and the area around it.
The name of the new chain is still a closely kept secret. The name of the McDonald’s app was changed to “My Burger” on Friday, which caused some buzz online. However, the chain’s press team told the RBC daily that this was only a temporary change.
On the home page of the app, there was a motto that said, “Some things change, but stable work is here to stay.”
According to leaked pictures of the new menu, the Filet-O-Fish will now be called the “Fish Burger,” and the Chicken McNuggets will be called “Nuggets.” Reuters was not able to confirm the changes.
HEADWINDS
Govor has said that he wants to open 1,000 new restaurants under the new brand and reopen all of the chain’s restaurants within two months. But there might be some wind against them.
Peter Gabrielsson, a professor of international marketing at the University of Vaasa in Finland, said that it takes decades to build a brand, and that the new launch is very important for the brand’s future success.
“Opening day is important because it’s the first time customers really get to know the brand and what it stands for,” he said. “It’s important to see how people react, and it’s clear that they will compare it to McDonald’s.”
McDonald’s is the biggest burger chain in the world. It used to own 84 percent of its nearly 850 Russian restaurants.When it sold those restaurants to Govor, whose company had already run 25 restaurants, it had to pay up to $1.4 billion.
McDonald’s Russia’s Oleg Paroev said that other franchisees could work under the new brand, but the old McDonald’s brand would leave the country. McDonald’s has said that it will keep its brands.
Russia and Ukraine brought in about 9 percent, or $2 billion, of McDonald’s sales last year. McDonald’s can buy back its restaurants in Russia within 15 years, but many details of the sale to Govor are still unclear.
A source close to Rosinter Restaurants, another franchisee, told the TASS news agency on Wednesday that McDonald’s would stay open as usual at airports and train stations in Moscow and St. Petersburg until 2023.
“Rosinter has a special deal that says the American company can’t take away the franchise.” They can work without trouble, “TASS said what the source said.
Rosinter declined to comment. McDonald’s didn’t answer right away.