Private equity firm Roark Capital Group has reportedly emerged as the lead bidder, at about $9.6 billion, for Subway restaurants, according to a report Monday in the Wall Street Journal.
Quick-service Subway, which has corporate offices in both Milford, Conn., and Miami, put itself up for auction earlier this year, confirming it in February with the retention of JP Morgan as an adviser, and the Journal cited “people familiar with the matter” for the Roark news.
“Subway does not intend to make any further public comment regarding the process until the transaction has been completed,” a Subway spokesperson said Monday afternoon.
Sources said the potential sale remains competitive and fluid. The Journal, in its report, acknowledged the possibility that another group could come back with a higher offer and prevail in the auction.
Roark, based in Atlanta, has invested in a number of franchised restaurant brands. Its portfolio includes Inspire Brands (which owns and franchises Arby’s, Baskin-Robbins, Buffalo Wild Wings, Dunkin’, Jimmy Johns and Sonic Drive-In) and Focus Brands (which owns and franchises Auntie Anne’s, Carvel, Cinnabon, Jamba, McAlister’s Deli, Moe’s Southwest Grill and Schlotzsky’s) as well as Carl’s Jr. and Hardee’s, Miller's Ale House, and the franchisor of Seattle's Best Coffee.
Subway, known for its foot-long sandwiches, has been held by its two founding families for more than 50 years.
Subway was founded by Fred DeLuca and financed by Peter Buck in 1965 as Pete's Super Submarines in Bridgeport, Conn. It was renamed Subway in 1972, and a franchise operation began in 1974 with a second restaurant in Wallingford, Conn. Both of the founders have died.
Subway had about 20,810 U.S. locations last year, and about 37,000 restaurants globally.
John Chidsey, the brand’s first CEO from outside of Subway’s founding families, took the helm in 2019. During a 2022 interview, Chidsey said he was shifting Subway’s focus from the quantity of franchises to quality of operators.
The company in July completed Phase 3 of its brand renovation, spending $80 million to roll out meat slicers to all of its U.S. restaurants. Earlier, it had introduced a line of prepared sandwiches to be ordered by name and number.
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