Taco Bell Franchisees to Receive $60 Million

Tricon Global Restaurants Inc. said its U.S. Taco Bell franchisees will receive $60 million for lost business due to customer fears over genetically modified corn in its taco shells.

Tricon and an association representing the franchisees reached an agreement with the suppliers of the company’s taco shells that calls for the suppliers to compensate the franchisees with an amount based on the number of restaurants each owns. Tricon, which is forgoing payment for its company-owned Taco Bell units, did not identify the suppliers.

Late last year, Taco Bell restaurant sales fell when its shells were confused with those recalled by Philip Morris Cos.’ Kraft Foods unit for containing genetically modified corn. As part of the agreement, the association representing franchisees, called FRANMAC, will join Tricon and the taco shell suppliers in seeking damages from the companies that introduced StarLink corn into the U.S. supply chain, Tricon said. Tricon shares rose 52 cents to close at $45.78 on the NYSE.