On this photograph representation, a Subway meal is noticed on a desk at a Subway eating place on January 12, 2023 in Austin, Texas.
Brandon Bell | Getty Photographs
Roark Capital is purchasing Subway, finishing the sandwich chain’s greater than 5 many years of circle of relatives possession and staining a brand new technology for the suffering corporate.
The announcement ends the chain’s long sale procedure, which publicly kicked off in February. Subway reportedly sought $10 billion, a excessive value that alienated many attainable suitors like eating place conglomerates, leaving handiest non-public fairness companies to duke it out in an public sale. Different reported bidders incorporated TDR Capital and Sycamore Companions.
Roark’s present portfolio contains greater than a dozen eating place chains. Subway dwarfs they all via collection of eating places, and brings in additional annual gross sales than all however Dunkin’.
Via protecting corporate Encourage Manufacturers, Roark owns Dunkin’, Baskin-Robbins, Sonic, Arby’s, Buffalo Wild Wings and Jimmy John’s. One at a time, housed underneath Center of attention Manufacturers, the company owns Auntie Anne’s, Carvel, Cinnabon, Jamba, McAlister’s, Moe’s Southwest Grill and Schlotzsky’s. Roark additionally invested $200 million within the Cheesecake Manufacturing unit all the way through the early days of the Covid pandemic to assist the suffering chain stave off insolvency.
Subway has been seeking to flip round its trade underneath CEO John Chidsey, who joined the corporate in 2019. The corporate has remodeled its menu, recruited new franchisees and invested in era. Within the first of part of the yr, its same-store gross sales climbed 9.8%, appearing that the turnaround could also be taking grasp.
Based in 1965 via Fred DeLuca and Peter Greenback, Subway grew from a unmarried sandwich store in Connecticut to a world eating place massive.
However for more or less a decade, the corporate’s gross sales have fallen. Its standard $5 footlong sandwich deal and competitive building put force on franchisees’ income. The chain used to be harm additional via the high-profile trial of former spokesman Jared Fogle and the demise of CEO DeLuca, which each befell in 2015.
Subway ended 2022 with more or less 20,600 places open within the U.S., down from its top of 27,100 in 2015, consistent with franchise disclosure paperwork. Whilst the chain remains to be ultimate franchised places, the tempo has bogged down significantly. The chain shuttered 571 gadgets closing yr, down from the greater than 1,600 eating places it closed in 2020.
DeLuca’s part of the corporate used to be left to his circle of relatives after his demise. Greenback, who died in 2021, bequeathed his to a charity run via his sons. Chidsey advised Eating place Industry On-line that he satisfied the 2 households to imagine promoting the corporate.
