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Subway: A New Era for the Iconic Sandwich Chain

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In a major development for the fast-food industry, Subway, the popular sandwich chain, has sold itself to private equity firm Roark Capital, marking the end of its nearly six-decade run as a family-owned business. The acquisition reflects Subway’s desire to embark on a new era of growth and transformation, leveraging Roark’s expertise in the restaurant and franchise business models. This article delves into the details of this significant transaction, explores the challenges faced by Subway, and analyzes the potential opportunities that lie ahead.

The Deal and Roark Capital

Subway’s sale to Roark Capital represents a major milestone in its ongoing transformation journey. While the exact transaction price was not disclosed, reports from The Wall Street Journal suggest that it was around $9.6 billion, slightly below Subway’s initial asking price of $10 billion. Roark Capital, a private equity firm, boasts a diverse portfolio of restaurant chains, including Arby’s, Auntie Anne’s, Buffalo Wild Wings, Carvel, and Sonic. Through its subsidiary, Inspire Brands, Roark also owns Dunkin’, which operates Subway rival Jimmy John’s.

Subway’s Recent Revival

In recent years, Subway has made concerted efforts to revive its business and regain its position in the highly competitive fast-food industry. The company implemented significant changes, including a revamped menu featuring freshly sliced meat, store renovations, and an increased focus on international growth. These efforts have yielded positive results, with Subway announcing its 10th consecutive quarter of positive sales in July 2023. During this period, its North America locations experienced a 9.5% increase in sales, indicating a resurgence in customer interest and satisfaction.

Challenges and Competition

Despite Subway’s recent sales turnaround, the number of its stores in the United States has declined from a peak of 27,219 locations in 2015 to 20,576 in the previous year. This decrease can be attributed to various factors, including intense competition from sandwich-making rivals and a decline in profitability for franchisees. According to data from QSR Magazine, Subway’s main competitors, such as Jersey Mike’s, Firehouse Subs, and Jimmy John’s, generate approximately $1 million per unit, while Subway locations generate less than $500,000 on average. Although Subway’s US revenue rebounded to $9.8 billion in 2022, it still falls short of the $11.5 billion it achieved in 2015.

Roark’s Vision for Subway

Roark Capital’s acquisition of Subway presents an opportunity for the company to undergo significant changes to improve sales and profitability. Neil Saunders, a managing director of GlobalData, suggests that Roark may focus on consolidating the number of franchisees, increasing its share of meal occasions in the market, and engaging consumers with menu innovations. With Roark’s extensive experience in the foodservice sector and its track record of nurturing restaurant brands, there is an expectation that it will apply its successful playbook to Subway.

The Future of Subway

The sale of Subway to Roark Capital represents a turning point for the iconic sandwich chain. Subway’s CEO, John Chidsey, expressed optimism about the company’s long-term growth potential under Roark’s ownership. He emphasized the value of Subway’s brand and franchisees worldwide and committed to a win-win-win approach for franchisees, guests, and employees. The transaction is subject to regulatory approvals and customary closing conditions, highlighting the final stages of this historic deal.

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Leadership Changes at Subway

In a related development, Subway recently announced changes in its leadership. Trevor Haynes, the president of Subway’s North America operations, is leaving the company after 18 years of service. Douglas Fry, the current leader of Subway’s Canada operations, will assume the role of president for Subway’s North America operations next month.


Subway’s sale to Roark Capital marks a significant shift for the sandwich chain, ending its long-standing family ownership and opening the doors to new possibilities and growth opportunities. With Roark’s extensive experience in the foodservice sector and a portfolio of successful restaurant chains, Subway has the potential to undergo a revitalization that will benefit its franchisees, customers, and employees. As the transaction progresses through the final stages, the industry eagerly awaits the next chapter in Subway’s journey.


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