KFC Israel Franchise Receivers Find Potential Buyers Amid Bankruptcy
Translated & summarized from NEWSru Israel by baba
Court-appointed receivers for the Israeli KFC franchise have found interested buyers during bankruptcy proceedings and are seeking permission to hold a tender. The franchise, operating 12 restaurants, filed for bankruptcy with 50 million shekels in debt, citing reduced profitability due to the war and inability of its Russian owners to transfer funds. Receivers are working to stabilize operations and retain the 120 employees.
The story in 6 lines · by baba
- Several parties are interested in buying the Israeli KFC franchise during bankruptcy proceedings.
- The Israeli KFC franchise owes 50 million shekels, with 37 million owed to its Russian owners.
- The franchise's profitability dropped significantly after the start of the 'Iron Swords' war.
- Russian owners cannot transfer funds to Israel due to sanctions.
- The company employs approximately 120 people.
- Former KFC restaurants in Russia now operate as Rostic's.
Court-appointed receivers for the Israeli KFC franchise have informed the court that several parties have expressed interest in acquiring the chain during the initial stages of its bankruptcy proceedings. The receivers are seeking court permission to launch an official tender for the company or its operations, with the consent of the bankruptcy trustee. Concurrently, they will continue efforts to stabilize the franchise's current business activities.
Last week, the Beer Sheva District Court appointed two receivers to assess the company's potential for recovery and mandated an initial report within 14 days. The receivers have met with company management and are working to resolve issues with key suppliers of chicken, flour, buns, and beverages. A primary objective is to retain the approximately 120 employees.
The company "Smart-Service D&K," which operates 12 KFC restaurants in Israel, had filed for bankruptcy protection, citing debts of 50 million shekels. Of this amount, 37 million shekels are owed to its owners, Konstantin Kotov and Andrey Oskolkov. The company stated that its profitability significantly declined following the "Iron Swords" war and subsequent escalations, and its Russia-based owners are unable to transfer funds to Israel due to sanctions on Russian financial institutions.
Previous attempts to find a strategic investor or buyer have been unsuccessful. Kotov and Oskolkov, entrepreneurs from Izhevsk, previously co-owned "Smart Service," which purchased KFC's Russian business from Yum! Brands in 2023 after the corporation's withdrawal from Russia. The former KFC restaurants in Russia now operate under the Rostic's brand.
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