Subway Sold to Roark Capital: Subway, the famous sandwich chain, was acquired by Roark Capital for “around $9.6 billion.” This ends Subway’s nearly six-decade family-owned tradition. Subway says the acquisition is “subject to regulatory approvals and customary closing conditions,” but the terms are unknown.
CEO John Chidsey stated in a press statement that Subway has a bright future under Roark. We will continue to prioritize a win-win-win approach for our franchisees, visitors, and employees.” Subway calls the acquisition a significant moment in its “multi-year transformation journey.” Roark’s expertise in franchise and restaurant growth could boost Subway’s growth and brand value.
Roark Capital has experience with restaurants. The equity firm invests in Arby’s, Auntie Anne’s, Buffalo Wild Wings, Carvel, and Sonic. This fast-food deal is among the largest, following Inspire Brands’ $11.3 billion Dunkin’ purchase in October 2020. Roark’s Inspire Brands runs Jimmy John’s, a Subway competitor.
Subway has undergone several changes, including a menu revision highlighting freshly sliced meats, restaurant renovations, and a worldwide expansion.
Also Read: Roark Capital Subway Takeover: Navigating the $9 Billion Sandwich Chain Acquisition
In July, the chain recorded its 10th straight quarter of positive sales for stores open at least a year, with North American sales up 9.5%. Even though they didn’t release numbers, they show the brand’s resiliency.
However, issues persist. Technomic reported that Subway had 20,576 US stores last year, down from 27,219 in 2015. Subway also trails its immediate competitors in per-unit sales. According to QSR Magazine, Subway stores sell under $500,000, Jersey Mike’s, Firehouse Subs, and Jimmy John’s average $1 million per unit.
But Subway’s US revenue has recovered, rising 4% to $9.8 billion in 2022. These results fall short of the company’s 2015 $11.5 billion peak.
Industry experts watch Roark’s next moves. GlobalData managing director Neil Saunders said, “Roark needs to make changes to improve sales and profitability. They should improve efficiency, gain market share, and engage customers with menu innovations.” He added that Roark’s extensive restaurant brand knowledge and profitability position it well to optimize Subway’s operations.
Subway reshuffled its executive team amid these changes. Trevor Haynes, an 18-year Subway veteran, will step down as president of North America next month and be replaced by Douglas Fry, head of Canada. This acquisition will usher in a new age of fast-food expansion, adaption, and rivalry for Subway.
Our Reader’s Queries
How much did Roark Capital pay for Subway?
The Wall Street Journal reports that Subway, a family-owned business with a nearly 60-year history and a portfolio of other sandwich shops, has been listed for sale at $10 billion. Private equity firm Roark Capital has made an offer of $9.6 billion to acquire the popular sandwich chain. This acquisition marks a significant change for Subway and its loyal customers.
Why did Subway sell to Roark?
Subway has recently announced a sale to Roark Capital, with CEO John Chidsey expressing confidence in the brand’s long-term growth potential and the value it brings to franchisees worldwide. This move is a testament to Subway’s commitment to expanding its reach and continuing to provide high-quality products and services to its loyal customers. With this sale, Subway is poised to take its place as a leader in the fast-food industry, and customers can expect even more exciting developments in the years to come.
Who bought Subway in 2023?
Roark Capital is a private equity firm based in Atlanta that manages $37 billion in assets. Their primary focus is on investing in consumer and business service companies, with a particular emphasis on franchise and multi-location businesses in the retail, restaurant, consumer, and business services sectors.
Who bought out Subway franchise?
Subway, a family-owned business for almost 60 years, has been acquired by Roark Capital, a private equity firm, in a historic transaction. However, Roark Capital’s portfolio includes other sandwich shops as well.