Subway Sells to Dunkin’ Owner for a Staggering $9.6 Billion

Subway is now owned by the Roark Capital Group, a company that owns several other food franchises, including Dunkin’.

Less than a decade later, DeLuca and Buck, now business partners, were doing so well that they started to franchise Subway. And as they say, the rest is history. However, while most fast-food chains are sold once they become highly valued, the co-owners held onto Subway—until now.

Both TDR Capital and Sycamore Partners wanted Subway, though after months of negotiations, the families decided to sell the sandwich company to Roark Capital Group for a total of $9.6 billion; obviously DeLuca and Buck’s original investment of $1,000 paid off for their families!

Roark’s $37 billion is made up of a wide variety of food chains including Baskin Robbins, Carl’s Jr., Sonic, Auntie Anne’s, Arby’s, and, of course, Dunkin’.

In 2020, Roark Capital Group paid $8.8 billion for the franchise, just months after the company decided to rebrand. You may remember it was once called Dunkin’ Donuts, but in January 2019, it rolled out a multimillion dollar plan to change the name as well as promote the business as a drinks-based restaurant as opposed to focusing on donuts and pastries. But don’t worry, they still sell food with their coffee.

Though the company has seen its fair share of highs and lows, it remains one of the most popular food-chain restaurants in the country and around the world. At the 37,000 Subway restaurants in over 100 countries around the world, the idea is simple: Fresh ingredients served on fresh bread, at an affordable price point.

Some new reports state that Subway’s ingredients aren’t nearly as good for the customer as it claims they are, something that may have led to its disappointing profits in the past few years. Others argue that Subway has been struggling thanks to the success of its direct competitor, Jersey Mike’s

However, beyond its worldwide expansion, it seems that Subway will operate in the same way it always has. In fact, Subway will remain as its own entity—only now, within Roark’s investment portfolio and with its seemingly endless funding for support.

Subway’s chief executive John Chidsey told the media that Roark plans to keep Subway functioning as it always has, stating, “They understand our business.”

However, Ed Shanahan, executive director of the Dunkin’ Donuts Independent Franchisee Association, said that he doesn’t believe the restaurants should be or will be combined in the US—it will only occur at international locations.

In order for Dunkin to thrive internationally, Roark would need to invest in more kitchens to make donuts and pastries, but it would certainly be a risk as the world has not yet become as obsessed with Dunkin’ as America has. Therefore, Roark’s idea is to combine Dunkin’ and Subway restaurants abroad so that the two can share a kitchen.

It’s yet to be seen if Subway will change with new ownerships, but Chidsey believes in the partnership. He told the press, “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.”