* Hejun Vanguard Group filed two complaints with MOFCOM
* Company says McDonald's franchise deal will pressure costs
* McDonald's says it has filed deal for MOFCOM review
By Michelle Price and Julie Zhu
HONG KONG, Feb 16 A Chinese consultancy that has
previously helped to win antitrust battles against Coca-Cola
and Apple has taken aim at McDonald's Corp
, arguing in a complaint to regulators that the American
fast food giant's China sale may hurt workers and consumers.
McDonald's said last month it had agreed to sell the bulk of
its China and Hong Kong business to state-backed conglomerate
CITIC Ltd and U.S. private equity firm Carlyle Group
LP for up to $2.1 billion, in a deal that will see the
consortium act as the master franchisee for a 20-year period.
The complaint, which follows allegations from a U.S. labour
union that the transaction will likely lead to poorer pay and
conditions for McDonald's 120,000 workers in China, could delay
regulatory approval for the deal.
Beijing-based Hejun Vanguard Group, a Chinese management
consultancy that has a track-record of representing domestic
companies against foreign firms, filed two separate complaints
against McDonald's with the Ministry of Commerce's (MOFCOM)
antimonopoly bureau and its franchise office, Hejun Vanguard
MOFCOM did not immediately respond to a request for comment.
CITIC, CITIC Capital and Carlyle declined to comment.
"The deal will put enormous downward pressure on McDonald's
master franchisees, existing franchisees that operate individual
stores, and the workers and customers of those stores," said Li
Su, CEO of Hejun Vanguard Group in a statement.
"Regulators should investigate the transaction and impose
restrictions to prevent McDonald's from abusing its dominant
CITIC and CITIC Capital, an affiliate company that manages
private equity funds, will hold 52 percent following the deal.
Carlyle will control 28 percent of the business, while
McDonald's will retain a 20 percent stake.
McDonald's currently owns and operates most of its outlets
on the mainland but the deal will see the fast-foot giant move
to a franchise model that should allow it to continue to profit
from sales while cutting costs.
(Reporting by Michelle Price; Edited by Martin Howell)