From the November 2009 issue of Treasury & Risk magazine

Gold AHA Winner in Liquidity Management

McDonald's was pushing forward at full speed with capital-intensive projects that would have to be funded with debt, as well as cash flow, when the credit crunch hit. Many corporations brought expansionary programs to a screeching halt as credit availability vanished, but McDonald's never slowed down.

Keeping credit flowing, not only to the company but to its 5,000 worldwide franchisees and to key suppliers, posed a serious challenge. "Our system needed significant liquidity between January 2008 and May 2009," recalls Robert Donovan, corporate vice president of finance at McDonald's, "and treasury had to facilitate access to capital in the worst credit environment many of us could remember. Yet we were able to access more credit during this period than at any time in our history." Still on track: a program to return $15 billion to $17 billion to shareholders by the end of 2009 through dividends and share buybacks.

McDonald's needed significant capital to finance the rollout of its McCaf? beverage business to more than 11,200 restaurants, the biggest product rollout since the chain introduced breakfast in the 1970s. Keeping franchisees liquid was a top priority. Treasury lined up nearly 100 new lenders through an intense focus on the franchise credit model and the McDonald's story.

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