USA – Private equity firm Blackstone has revealed plans to acquire sandwich restaurant chain Jersey Mike’s Subs in a deal that values the sandwich chain at US$8 billion, including debt.
Negotiations between Blackstone and Jersey Mike’s have been ongoing since 2021, with the deal including an earn-out agreement contingent on the sandwich chain reaching its 4,000th store, as reported by Reuters.
The transaction is expected to be finalized in early 2025. Should the deal proceed, founder and CEO Peter Cancro will retain a significant equity stake and continue to lead the company.
Cancro expressed confidence in the partnership, stating, “We believe we are still in the early innings of Jersey Mike’s growth story and that Blackstone is the right partner to help us reach even greater heights.”
“Blackstone has helped drive the success of some of the most iconic franchise businesses globally, and we look forward to working with them to make significant new investments moving forward.”
Peter Wallace, senior managing director at Blackstone, highlighted Jersey Mike’s long-standing success, saying, “Jersey Mike’s has grown for more than half a century by maintaining an unrelenting focus on quality (and delicious sandwiches) – consistently building on its loyal customer base as it has scaled nationwide.”
Jersey Mike’s operates more than 3,000 locations across the U.S. and the partnership with Blackstone aims to accelerate its expansion within the U.S. and internationally.
The deal also includes investments in technology and digital transformation for the brand.
This acquisition is in line with Blackstone’s strategy of investing in franchise-based businesses.
With over US$1.1 trillion in assets under management, Blackstone has made several notable investments in food franchises in 2024, including a stake in 7 Brew Coffee and the purchase of Tropical Smoothie Cafe from Levine Leichtman Capital Partners.
In April, Blackstone agreed to acquire Tropical Smoothie Cafe, another fast-growing food franchise. The firm’s past investments include the 2007 purchase of Hilton Hotels and a stake in the restoration services franchise Servpro.
The increasing private equity interest in franchise operators is evident, with Roark Capital’s acquisition of Subway last year in a deal valued at up to US$9.55 billion, including debt, according to sources familiar with the transaction.
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