Subway, the chain known for its footlong sandwiches, is considering a sale, according to reports citing anonymous sources.
“As a privately held company, we don’t comment on ownership structure and business plans,” a company spokesperson told Entrepreneur via email, echoing its statement to the Wall Street Journal and Reuters. Both outlets reported the news Wednesday evening.
“We continue to be focused on moving the brand forward with our transformational journey to help our franchisees be successful and profitable,” the Subway rep added.
The deal could value the company at over $10 billion, the WSJ reported. It also said that the company is retaining advisers to help look into a sale. However, the outlet also notes private equity (if a firm in the sector emerged as a possible buyer) has been struggling to obtain certain types of financing amid higher interest rates, making a potential sale possibly more challenging.
Subway’s sales in 2021 were up by 13% compared to 2020, the WSJ also noted.
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But Subway has been in turnaround mode, particularly when it took on a new CEO, John Chidsey, in 2019. The once-on-top-of-the-world franchise first saw its sales slump in 2012, which continued for years, the WSJ reported.
Subway even began certain tactics to whittle down franchisees after what some saw as overexpansion, the New York Times reported in 2019. The company’s inspectors were reportedly directed to find fault with the franchise operators and remove the businesses from the operators (at which point the company could theoretically take them over or shut them down).
“I was kind of his hit man,” one inspector, Rebecca Husler, told the NYT at the time. She said she did not look back fondly on her time kicking out the franchise owners. “We’re ruining these people,” she added to the outlet.
The number of franchises in the U.S. has decreased by about 3,000 in the last few years.
Subway was founded in 1965 in Connecticut and started franchising in 1974. It now has some 37,000 locations worldwide, per the company’s website. As the WSJ noted, the chain was run by its co-founder, Fred DeLuca, for 50 years, and after that, people related to the two families who were involved in launching the business led the chain.
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In February 2022, Chidsey told the WSJ his plans included focusing on global rather than U.S. expansion, adding more “craveable” foods to compete with other sandwich chains, and leaning into third-party delivery and other digital experiences.
In 2021, reports emerged that Subway was thinking about a sale, and the company denied them, as Reuters reported.
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