399 views
/Subway

Subway sale to set focus on international expansion

The chain has been losing ground in terms of sales per outlet in the US.

Subway’s sale to private equity firm Roark Capital would mean more focus on international expansion, market research provider Euromonitor International said.

According to Dorothy Calba, Senior Research Manager at Euromonitor International, within the US market, Subway still maintains its position as the largest sub chain however, since the mid-2010s, competition in the market has continued to increase with new players entering the space and even reporting higher sales per outlet compared to the fast-food giant.

"Subway has since 2021 been turning sales around by looking to focus on quality perception and investing in marketing. This sale should help this investment and push forward quality initiatives like the nationwide roll out of in-house meat slicers. Sales for Subway have been very solid so far in 2023 and this sale is promising in terms of their future growth,” Calba said.

In a press release on 24 August, the brand said it has entered into a definitive agreement to be acquired by affiliates of Roark Capital. The fast food chain said the transaction is a major milestone in Subway's multi-year transformation journey, combining Subway's global presence and brand strength with Roark's deep expertise in restaurant and franchise business models.

Roark, who has $37b in assets, also has stakes in Dunkin. Roark focuses on investments in consumer and business service companies, with a specialization in franchise and franchise-like businesses.

"This transaction reflects Subway's long-term growth potential, and the substantial value of our brand and our franchisees around the world. Subway has a bright future with Roark, and we are committed to continuing to focus on a win-win-win approach for our franchisees, our guests and our employees," said John Chidsey, CEO of Subway. 

Details of the deal were not disclosed however the chain was estimated to be around US$9b.

According to Euromonitor International, Subway holds the top position in the global bakery products limited-service restaurants sector, accounting for over 14% of sales in 2022.

The fast-food chain recently inked its biggest franchise deal in China.

Follow the link for more news on

Join QSR Media Australia community
Since you're here...

...there are many ways you can work with us to advertise your company and connect to your customers. Our team can help you dight and create an advertising campaign, in print and digital, on this website and in print magazine.

We can also organize a real life or digital event for you and find thought leader speakers as well as industry leaders, who could be your potential partners, to join the event. We also run some awards programmes which give you an opportunity to be recognized for your achievements during the year and you can join this as a participant or a sponsor.

Let us help you drive your business forward with a good partnership!

Exclusives

5 challenges QSRs faced when implementing loyalty programmes
1 in 2 Australian loyalty programme members are active in all of the loyalty programmes they are a member of.
Research
What fueled Oporto’s 200 restaurant growth?
The brand perfectly balanced its portfolio to capitalise on changing consumer preferences.