By Abigail Summerville and Anirban Sen NEW YORK (Reuters) - Private equity firm Roark Capital is in the lead to acquire sandwich chain Subway for well ...
STORY CONTINUES BELOW THESE SALTWIRE VIDEOSNEW YORK - Private equity firm Roark Capital is in the lead to acquire sandwich chain Subway for well over $9 billion after attaching conditions to some of the windfall the two families that own it will get, people familiar with the matter said on Tuesday.
The families put Subway up for sale hoping to fetch more than $10 billion based on its strong brand and international growth, but the private equity firms countered it was worth less because they deemed its U.S. business saturated. The consortium has been seeking to convince Subway's owners that a deal with Roark would face U.S. antitrust risk given the latter's ownership of other restaurant brands, including sandwich chain Jimmy John's, the sources said.
A spokesperson for Subway declined to comment, while representatives for Roark and TDR did not immediately respond to requests for comment. Sycamore and Goldman Sachs declined to comment. The Milford, Connecticut-based company has been revamping its operations to deal with outdated decor and $5 deals on foot-long sandwiches that eroded franchisees' profits. In 2021, the chain launched a menu overhaul and splashy marketing campaign as it embarked on a turnaround plan that has helped sales grow.
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