Blackstone announced Tuesday that it has acquired a majority stake in Jersey Mike's Subs, valuing the fast-growing sandwich chain at approximately $8 billion. The investment is set to accelerate Jersey Mike's expansion, bolstering its technological capabilities and fueling plans for a broader global footprint.
Founded in 1956 in Point Pleasant, New Jersey, Jersey Mike's Subs has evolved over nearly seven decades into a powerhouse in the quick-service restaurant (QSR) sector. The chain's transformation was spearheaded by CEO Peter Cancro, who started working at the original shop in 1971 as a teenager. By age 17, Cancro had purchased the business and, over the years, developed it into a significant competitor to industry giants like Subway. Today, Jersey Mike's has around 3,000 locations across the U.S. and Canada, making it the second-largest sub chain in the country. Cancro, who will continue in his role as CEO and maintain a significant equity stake, voiced his optimism about Blackstone's partnership.
"We believe we are still in the early innings of Jersey Mike's growth story, and that Blackstone is the right partner to help us reach even greater heights," Cancro said in a statement.
The acquisition underscores Blackstone's growing interest in the QSR sector, which offers predictable revenue streams and scalable business models attractive to private equity. Jersey Mike's success, with systemwide sales exceeding $3 billion annually, has been driven by its franchise-based business model and reputation for quality, made-to-order subs. Blackstone's investment, the company noted, will allow Jersey Mike's to further build on this foundation by accelerating its digital transformation and expanding into new markets.
Analysts suggest Blackstone's involvement will enhance Jersey Mike's operational capacity, paving the way for potential international expansion in Europe and Asia. The chain's swift adoption of digital solutions, including online ordering and delivery services, has already positioned it to cater to evolving consumer preferences. The pandemic underscored Jersey Mike's adaptability, as the chain leveraged technology to meet increased demand for delivery and digital ordering options, resulting in a 22% growth in online sales in the U.S. alone.
The investment also aligns with a trend of private equity involvement in the QSR industry, following other major deals like Roark Capital's acquisition of Subway and Inspire Brands' purchase of Dunkin'. Blackstone's capital infusion is expected to bring benefits for Jersey Mike's franchisees, from enhanced training and marketing resources to streamlined supply chain processes. Franchisees and stakeholders view the partnership as an opportunity to bolster the brand and continue its growth trajectory.
"This partnership allows us to dream bigger while staying grounded in what makes Jersey Mike's special-our people, our product, and our purpose," Cancro said. The acquisition positions Jersey Mike's as a formidable player in the QSR sector, setting the stage for more intense competition with other global sub chains, including Subway, as it looks to expand into new markets and reach more consumers.
As the acquisition awaits regulatory approval, which is expected by early 2025, both Blackstone and Jersey Mike's have expressed a commitment to delivering on the chain's ambitious growth goals. Blackstone's resources and expertise are anticipated to play a key role in this expansion, allowing Jersey Mike's to maintain its focus on quality and community impact even as it scales.
