Subway stated Thursday it is going to be offered to Roark Capital, a non-public fairness agency with experience in restaurant administration that would assist the sandwich chain broaden and enhance its shops.
Phrases of the deal weren’t disclosed. Earlier this week, The Wall Avenue Journal reported that Atlanta-based Roark was providing round $9.6 billion for Subway, which is privately owned.
Subway CEO John Chidsey, who joined the corporate in 2019, stated the deal displays Subway’s long-term development potential and the worth of the model. Subway plans to proceed to modernize eating places and broaden internationally underneath Roark’s possession. Subway stated its management group will stay in place.
Roark is a non-public fairness agency with $37 billion in property underneath administration. It makes a speciality of franchised companies and backs two holding firms that personal a number of restaurant chains: Encourage Manufacturers, the mum or dad of Arby’s, Dunkin’, Jimmy John’s and Buffalo Wild Wings; and Focus Manufacturers, which owns Auntie Anne’s, Carvel, Cinnabon and Jamba.
Subway, which has twin headquarters in Miami and Connecticut, was based in 1965 and continues to be owned by its founding households. It is now one of many world’s largest restaurant chains, with 37,000 retailers in additional than 100 nations.
However within the U.S., it has been dropping market share lately to fast-growing rivals like Panera and Firehouse Subs, which function extra different menus and newer shops. Subway at present controls about 23% of the $43 billion U.S. sandwich and deli market, in accordance with Technomic, a consulting firm. That is down from 34% in 2017.
Subway has been making an attempt to catch up; in 2021 it refreshed its menu and final 12 months it introduced a line of chef-developed sandwiches after discovering that clients have been tiring of Subway’s conventional mannequin of letting clients construct their very own sandwiches.
However in February, Subway introduced it was exploring a sale.
Subway has some momentum going into the acquisition. In July, the corporate stated its world same-store gross sales __ or gross sales at places open at the very least a 12 months __ have been up 9.8% from the prior 12 months. The corporate has transformed 10,000 of its U.S. eating places and just lately spent $80 million to supply its 20,000 U.S. eating places with deli meat slicers, a primary for the model.