BENGALURU - Roark Capital, which owns restaurants Arby’s and Buffalo Wild Wings, is nearing a deal to buy sandwich chain Subway for about US$9.6 billion (S$13 billion), The Wall Street Journal reported.
A deal could be finalised this week, the report said, citing people familiar with the matter.
“Subway does not intend to make any further public comment regarding the process until the transaction has been completed,” the company told Reuters in an e-mailed statement.
Reuters reported earlier this month that private equity firms TDR Capital and Sycamore Partners were in talks to team up in their pursuit to acquire Subway, which in February said it was exploring a possible sale of its business.
Sources said then that Subway was targeting well over US$9 billion in a deal, and remains uncertain whether TDR and Sycamore can meet its price expectations. Another group led by Roark Capital was in the running, the sources had added.
Private equity firm Roark primarily invests in the franchised consumer and business services sectors. It has invested in Inspire Brands, which is the owner of Arby’s, Baskin-Robbins, Buffalo Wild Wings and Dunkin’ among others.
Subway was launched with a single sandwich shop in Connecticut by 17-year-old Fred DeLuca in 1965. He started with an initial US$1,000 investment from family friend Peter Buck, as a way to pay his college tuition.
The two men famously started the venture based only on a handshake. Mr DeLuca died in 2015, while Mr Buck passed away in 2021.
The company, which now has about 37,000 restaurants running in over 100 countries, is still owned by the founding families.
For the first half of 2023, Subway saw a 9.3 per cent increase in same-store sales in North America, as its moves to revamp its menus, remodel its restaurants and improve marketing efforts helped draw more customers even in the face of stiff competition.
Subway executives have recently highlighted cost-cutting efforts to better compete with other restaurant chains, while focusing most growth efforts overseas.
In June, it unveiled a franchising agreement to open some 4,000 restaurants in mainland China over the next 20 years. REUTERS, AFP
