Baker McKenzie advised Subway, one of the world's largest restaurant brands, on its new master franchise agreement with Shanghai Fu-Rui-Shi Corporate Development Co., Ltd. (FRS), to significantly expand its presence in Mainland China.
FRS, funded by a consortium of private investors, including Asia Investment Capital, will open nearly 4,000 restaurants in Mainland China over the next 20 years, growing Subway's current footprint in the market by more than seven times. FRS will also acquire the exclusive rights to manage and develop all Subway locations in Mainland China. The agreement is the largest master franchise agreement in Subway history and reportedly one of the largest across the entire QSR industry.
"This agreement is a significant milestone in Subway's international growth strategy as we continue to focus on strategically expanding our footprint and maintaining our position as one of the world's largest restaurant brands," said John Chidsey, Subway Global Chief Executive Officer. "China is a key market with significant long-term growth opportunity, and we look forward to bringing the Subway experience to even more guests in the region."
Baker McKenzie fielded a cross-practice, cross-office team for the deal, offering advice on corporate, franchising, tax, and regulatory matters. The team was led by Partners Tracy Wut (Hong Kong), Mohammad Alturk (Dallas), Special Counsel Grace Wong (Hong Kong) and supported by Vivian Choi (Hong Kong), Curtis Tse (Hong Kong), Luke Christianson (Dallas), Nancy Lai (Shanghai), Mini vandePol (Hong Kong), Gerald Lam (Hong Kong) as well as FenXun partner Wenxin Zhou (Shanghai).
Commenting on the deal, Tracy Wut said, "We could not be more honoured to be able to assist our client on this important transaction and be able to play a role in their growth story. We look forward to continue supporting our client with their future legal and business needs."