Subway Takes a New Track: Now Part of the Dunkin’ Fam
Roark Capital has bagged itself as a sandwich giant, bringing Subway into its fold and ending over 50 years of the chain’s family reign. This marks a fresh chapter for Subway, which has seen its fair share of challenges.
The buzz about Subway’s sale started making the rounds in February, and they had a hefty $10 billion price tag in mind. This ambitious number made several big-shot restaurant groups step back, leaving private equity bigwigs like TDR Capital and Sycamore Partners in the ring. The final tally? A close $9.6 billion, according to the grapevine.
Roark isn’t new to the restaurant game. With an impressive roster that boasts names like Dunkin’, Sonic, Arby’s, and Buffalo Wild Wings under its Inspire Brands umbrella, Subway is the biggest catch regarding sheer restaurant count and sales, trailing only Dunkin’. Let’s not forget Roark’s lifeline to the Cheesecake Factory during the pandemic’s initial havoc.
Neil Saunders from GlobalData Analytics feels Roark’s involvement is a boon. Their diverse experience gives them an edge over others. Subway’s future within Roark? It’ll maintain its identity, assures Subway CEO John Chidsey.
Chidsey, steering Subway’s ship since 2019, has been trying to revitalize the brand. With a menu overhaul, tech upgrades, and fresh franchise faces, there’s a glimmer of hope as its sales saw a near 10% spike in the year’s first half.
Established in 1965 in Connecticut, Subway’s journey from a single shop to a worldwide sensation has been spectacular. But the past decade hasn’t been kind. The iconic $5 footlong deal strained franchisee wallets and events like the Jared Fogle trial and the passing of CEO DeLuca in 2015 didn’t help.
From a high of 27,100 US outlets in 2015, they’re now down to 20,600. Though closures persist, the rate has dipped.
DeLuca’s share went to his kin after his demise, while Buck, who passed in 2021, left his to a charity. Chidsey played a pivotal role in bringing both families on board with the idea of a sale.
