{"id":372564,"date":"2021-11-26T01:51:42","date_gmt":"2021-11-25T22:51:42","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/subways-future-in-doubt-after-death-of-sandwich-chains-founder\/"},"modified":"2021-11-26T01:51:42","modified_gmt":"2021-11-25T22:51:42","slug":"subways-future-in-doubt-after-death-of-sandwich-chains-founder","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/subways-future-in-doubt-after-death-of-sandwich-chains-founder\/","title":{"rendered":"#Subway&#8217;s future in doubt after death of sandwich chain&#8217;s founder"},"content":{"rendered":"<p>&#8220;<strong>#Subway&#8217;s future in doubt after death of sandwich chain&#8217;s founder<\/strong>&#8221;<\/p>\n<div>\n<aside class=\"single__inline-module alignleft\">\n<\/aside>\n<p>The death of a nuclear physicist who co-founded Subway Restaurants has thrown the fast-food giant\u2019s future into doubt, with dealmakers fretting that hopes to sell the struggling chain look more complicated than ever.<\/p>\n<p>Peter Buck \u2014 whose $1,000 loan to Fred DeLuca in 1965 to start a sandwich shop in Bridgeport, Conn. launched a global fast-food empire that made him a billionaire \u2014 died last week at the age of 90, the company said.<\/p>\n<p>What\u2019s less known is the fact that Subway earlier this year held informal talks to possibly sell itself to Restaurant Brands International, the Brazil-based owner of Burger King, sources close to the situation said. Those talks fizzled, the sources said, culminating in Restaurant Brands\u2019 move last week to instead buy Subway\u2019s smaller sandwich competitor Firehouse Subs for $1.1 billion.<\/p>\n<p>Negotiations with Subway had fallen apart, insiders said, partly because of disagreements on price \u2014 not only between Restaurant Brands and Subway, but also between Buck and co-founder DeLuca\u2019s widow, Elisabeth. Each controlled 50 percent of the chain since DeLuca\u2019s death in 2015, and one of them \u2014 it wasn\u2019t clear which \u2014 had been holding out for a higher price than the other, according to a source close to the situation. <\/p>\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter size-large\"><img decoding=\"async\" loading=\"lazy\" width=\"1024\" height=\"682\" src=\"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/11\/subway-founder-death-jeopardizes-chain2.jpg?quality=90&amp;strip=all&amp;w=1024\" alt=\"Exterior of a Subway restaurant\" class=\"wp-image-20273312\" srcset=\"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/11\/subway-founder-death-jeopardizes-chain2.jpg?quality=90&amp;strip=all&amp;w=1535 1536w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/11\/subway-founder-death-jeopardizes-chain2.jpg?quality=90&amp;strip=all 1024w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/11\/subway-founder-death-jeopardizes-chain2.jpg?quality=90&amp;strip=all&amp;w=512 512w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\"\/><figcaption>Subway would likely fetch between $8B and $10B in a sale \u2014 much less than the $50B valuation it had privately been eyeing before a possible IPO in 2012, sources told The Post.<\/figcaption><figcaption><span class=\"credit\">Getty Images<\/span><\/figcaption><\/figure>\n<\/div>\n<p>A Restaurant Brands spokesman said the company bought Firehouse Subs partly because of its \u201csignificant growth potential.\u201d As for Subway, the company said it doesn\u2019t \u201ccomment on market speculation or rumors.\u201d Subway declined to comment specifically when asked about the talks with Restaurant Brands. Instead, it said it remains focused on a turnaround.<\/p>\n<p>\u201cSubway is not for sale,\u201d a company spokesperson said in a statement. \u201cSales momentum has steadily been building since the beginning of 2021 and the\u00a0launch of Subway\u2019s Eat Fresh Refresh campaign this summer accelerated that momentum. We expect to exceed our sales projections in 2021 by more than $1 billion.\u201d<\/p>\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter size-large\"><img decoding=\"async\" loading=\"lazy\" width=\"1024\" height=\"682\" src=\"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/11\/subway-founder-death-jeopardizes-chain8.jpg?quality=90&amp;strip=all&amp;w=1024\" alt=\"Exterior of Firehouse Subs restaurant\" class=\"wp-image-20273293\" srcset=\"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/11\/subway-founder-death-jeopardizes-chain8.jpg?quality=90&amp;strip=all&amp;w=1535 1536w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/11\/subway-founder-death-jeopardizes-chain8.jpg?quality=90&amp;strip=all 1024w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/11\/subway-founder-death-jeopardizes-chain8.jpg?quality=90&amp;strip=all&amp;w=512 512w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\"\/><figcaption>Discussions about Subway selling itself to Burger King parent Restaurant Brands fizzled, ending in Restaurant Brands\u2019 move to buy Subway rival Firehouse Subs, sources told The Post.<\/figcaption><figcaption><span class=\"credit\">Moment Editorial\/Getty Images<\/span><\/figcaption><\/figure>\n<\/div>\n<p>Some dealmakers are skeptical, noting that Subway two years ago hired John Chidsey to be its first permanent chief executive. Chidsey\u2019s most notable achievement, they say, may have been his stint as CEO of Burger King, which culminated in the chain getting sold in 2010 to Restaurant Brands.<\/p>\n<p>Since taking the reins at Subway, Chidsey has squeezed franchisees for cash, raising fees and tightening lease restrictions \u2014 moves that can typically precede a sale. Now, however, dealmakers say the thinking of Buck and DeLuca\u2019s heirs remains a mystery.<\/p>\n<p>\u201cThis throws a wrench into the sale,\u201d one source said of Buck\u2019s death last week, noting that Buck was a widower. \u201cNow the shares might be tied up in probate.\u201d<\/p>\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter size-large\"><img decoding=\"async\" loading=\"lazy\" width=\"1024\" height=\"682\" src=\"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/11\/subway-founder-death-jeopardizes-chain3.jpg?quality=90&amp;strip=all&amp;w=1024\" alt=\"Fred DeLuca with a giant Subway sandwich held up to his mouth\" class=\"wp-image-20273295\" srcset=\"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/11\/subway-founder-death-jeopardizes-chain3.jpg?quality=90&amp;strip=all&amp;w=1535 1536w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/11\/subway-founder-death-jeopardizes-chain3.jpg?quality=90&amp;strip=all 1024w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/11\/subway-founder-death-jeopardizes-chain3.jpg?quality=90&amp;strip=all&amp;w=512 512w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\"\/><figcaption>Fred DeLuca, who ran Subway for more than half a century until his death in 2015, did little succession planning. <\/figcaption><figcaption><span class=\"credit\">AFP via Getty Images<\/span><\/figcaption><\/figure>\n<\/div>\n<p>DeLuca, who ran the company for more than half a century, did little succession planning. His sister, Suzanne Greco, took the CEO job after his death but stepped down in 2018 after a rocky tenure. DeLuca\u2019s son Jonathan is a director on the board but has no operational role at the company. Ditto for Buck\u2019s son Christopher, who runs the <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/social-mediaa\/\" data-internallinksmanager029f6b8e52c=\"1\" title=\"Social Media\" target=\"_blank\" rel=\"noopener\">media<\/a> nonprofit Retro Report.<\/p>\n<p>\u201cNo one knows what is in his will,\u201d a dealmaker close to the situation added of Buck. \u201cSounds like the Subway sale process is on indefinite hold.\u201d<\/p>\n<p>With Restaurant Brands out of the picture, Subway\u2019s sale prospects look dimmer. Roark Capital\u2019s\u00a0Inspire Brands, which owns Sonic and Buffalo Wild Wings, had been the other most logical buyer, but it acquired Subway competitor Jimmy John\u2019s in 2019. Yum, owner of Taco Bell and KFC, is still an outside possibility, but conventional wisdom is that buying Subway would drag down its stock price, sources said.<\/p>\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" loading=\"lazy\" width=\"1024\" height=\"682\" src=\"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/11\/subway-founder-death-jeopardizes-chain6.jpg?quality=90&amp;strip=all&amp;w=1024\" alt=\"John Chidsey sipping a drink through a straw from a Burger King cup\" class=\"wp-image-20273332\" srcset=\"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/11\/subway-founder-death-jeopardizes-chain6.jpg?quality=90&amp;strip=all&amp;w=1535 1536w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/11\/subway-founder-death-jeopardizes-chain6.jpg?quality=90&amp;strip=all 1024w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/11\/subway-founder-death-jeopardizes-chain6.jpg?quality=90&amp;strip=all&amp;w=512 512w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\"\/><figcaption>Current Subway CEO John Chidsey\u2019s most notable achievement may have been his stint as CEO of Burger King, which culminated in the chain getting sold in 2010 to Restaurant Brands, dealmakers told The Post, but that avenue <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>ears closed to Subway.<\/figcaption><figcaption><span class=\"credit\">South China Morning Post via Getty Images<\/span><\/figcaption><\/figure>\n<p>Now the most likely buyer would be a private equity firm like TPG Capital, which would likely pay a lower price than a major fast-food operator, dealmakers familiar with the situation said.<\/p>\n<p>\u201cI think it is private equity,\u201d a source close to the situation said. \u201cAnd I don\u2019t think sponsors would pay a big multiple.\u201d<\/p>\n<p>Sources briefed on the mega-franchise\u2019s business \u2014 whose nearly 22,000 locations nationwide generated $634 million in royalty fees last year, down from $834 million in 2019 \u2014 say it would likely fetch between $8 billion and $10 billion in a sale. <\/p>\n<div class=\"wp-block-image\">\n<figure class=\"alignright size-nypost-medium-post\"><img decoding=\"async\" loading=\"lazy\" width=\"322\" height=\"483\" src=\"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/11\/subway-founder-death-jeopardizes-chain5.jpg?quality=90&amp;strip=all&amp;w=322\" alt=\"Jared Fogle holding a Subway sandwich\" class=\"wp-image-20273328\" srcset=\"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/11\/subway-founder-death-jeopardizes-chain5.jpg?quality=90&amp;strip=all&amp;w=644 644w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/11\/subway-founder-death-jeopardizes-chain5.jpg?quality=90&amp;strip=all&amp;w=483 483w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/11\/subway-founder-death-jeopardizes-chain5.jpg?quality=90&amp;strip=all&amp;w=322 322w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/11\/subway-founder-death-jeopardizes-chain5.jpg?quality=90&amp;strip=all&amp;w=161 161w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/11\/subway-founder-death-jeopardizes-chain5.jpg?quality=90&amp;strip=all 1024w\" sizes=\"auto, (max-width: 322px) 100vw, 322px\"\/><figcaption>Subway has faced challenges, such as its former spokesman Jared Fogle\u2019s 2015 conviction on child-porn and sex crime charges. <\/figcaption><figcaption><span class=\"credit\">WireImage<\/span><\/figcaption><\/figure>\n<\/div>\n<p>That\u2019s a far cry from the $50 billion valuation that Subway had privately been eyeing as it prepped for a possible initial public offering in 2012, according to sources.<\/p>\n<p>That also was before former spokesman Jared Fogle\u2019s 2015 conviction on child-porn and sex crime charges. Meanwhile, Subway since has been slammed with bad publicity over its food, including accusations that its bread contained chemicals found in yoga mats; reports that its processed chicken contained sawdust; and this year a lawsuit that alleges it has been selling fake tuna. <\/p>\n<p>Subway in 2014 changed its bread recipe after the yoga-mat flap, but has consistently defended its chicken and tuna.<\/p>\n<p>In May 2012, Subway said it had over 25,000 US restaurants and it was growing at a quick pace. Now, that number is lower than 22,000, with more than 1,000 net closings a year for the last several years as many franchisees lose money.<\/p>\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter size-large\"><img decoding=\"async\" loading=\"lazy\" width=\"1024\" height=\"682\" src=\"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/11\/subway-founder-death-jeopardizes-chain4.jpg?quality=90&amp;strip=all&amp;w=1024\" alt=\"A Subway tuna sandwichposed on a Subway sandwich wrapper in this photo illustration\" class=\"wp-image-20273329\" srcset=\"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/11\/subway-founder-death-jeopardizes-chain4.jpg?quality=90&amp;strip=all&amp;w=1535 1536w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/11\/subway-founder-death-jeopardizes-chain4.jpg?quality=90&amp;strip=all 1024w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/11\/subway-founder-death-jeopardizes-chain4.jpg?quality=90&amp;strip=all&amp;w=512 512w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\"\/><figcaption>Subway is also facing a lawsuit that alleges it has been selling fake tuna, a claim the chain denies.<\/figcaption><figcaption><span class=\"credit\">dpa\/picture alliance via Getty Images<\/span><\/figcaption><\/figure>\n<\/div>\n<p>There are potential positives to Subway waiting to begin a formal sales process or even listing its shares, insiders said. The 56-year-old chain recently started producing audited financials for the first time. Under DeLuca, the chain had more than one hundred related entities, making it hard to fully understand, a source said.\n                        <\/p><\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/news\/\" target=\"_blank\" rel=\"noopener\">News category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/nypost.com\/2021\/11\/25\/subways-future-in-doubt-after-death-of-sandwich-chains-founder\/\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;#Subway&#8217;s future in doubt after death of sandwich chain&#8217;s founder&#8221; The death of a nuclear physicist who co-founded Subway Restaurants has thrown the fast-food giant\u2019s future into doubt, with dealmakers fretting that hopes to sell the struggling chain look more complicated than ever. Peter Buck \u2014 whose $1,000 loan to Fred DeLuca in 1965 to&#8230;<\/p>\n","protected":false},"author":1,"featured_media":372565,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/11\/subway-chain-future.png?w=1024","fifu_image_alt":"","footnotes":""},"categories":[70897],"tags":[120242,70976,70978,119965,70584,72179],"class_list":["post-372564","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-11-25-21","tag-burger-king","tag-fast-food","tag-fred-deluca","tag-mergers-acquisitions","tag-subway-sandwiches"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/372564","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=372564"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/372564\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/372565"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=372564"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=372564"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=372564"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}