Industry News

Jersey Mike’s serves ownership state to Blackstone

The growing sandwich chain has sold a stake in its operation to the private equity outfit.

Jersey Mike’s serves majority ownership position to Blackstone — Jersey Mike’s Subs

Courtesy of Jersey Mike's Subs

Jersey Mike’s Subs, a franchisor of fast-casual submarine sandwich stores, has announced today it has reached an agreement where private equity funds managed by Blackstone (led by Blackstone’s most recent flagship private equity vehicle) will acquire a majority ownership position in Jersey Mike’s.

Jersey Mike’s Founder and CEO Peter Cancro will maintain a significant equity stake and continue to lead the business. The partnership with Blackstone is intended to help enable Jersey Mike’s to accelerate its expansion across and beyond the U.S. market, as well as its continued investment in technology and digital transformation. According to a representative, Blackstone has a history of successfully propelling the growth of leading franchisors, including in its previous acquisitions of Hilton Hotels and SERVPRO, with recent investments in Tropical Smoothie Cafe and 7Brew.

Cancro began working at the company’s original Point Pleasant, NJ location at the age of 14, which was founded in 1956 as Mike’s Subs. He acquired the location in 1975 at age 17 and began franchising units in 1987. Today, Jersey Mike’s is a national franchisor with more than 3,000 locations nationwide open and in development and continues to be recognized for its high-quality and freshly prepared submarine sandwiches. The company has been recognized as one of the fastest-growing fast-casual restaurant chains in America and ranked #2 on Entrepreneur’s 2024 Franchise 500.

Cancro comments, “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. Blackstone has helped drive the success of some of the most iconic franchise businesses globally and we look forward to working with them to help make significant new investments going forward.”

Peter Wallace, senior managing director at Blackstone, says, “Jersey Mike’s has grown for more than half a century by maintaining an unrelenting focus on quality (and delicious sandwiches), consistently building on its loyal customer base as it has scaled nationwide. Blackstone has deep experience helping accelerate the expansion of high-growth franchise businesses and this area is one of our highest-conviction investment themes. We are excited to partner with an entrepreneur of Peter’s caliber and the talented Jersey Mike’s team. Our capital and resources will help support key investments in growth and technology for the benefit of Jersey Mike’s customers and exceptional franchisees. I highly recommend the #13 Original Italian, Mike’s Way.”

Giving back is said to be core to Jersey Mike’s mission. The company recently completed its 14th Annual Month of Giving, surpassing more than $113 million raised for local charities since 2011. It has also launched the Coach Rod Smith Ownership program, which helps provide store-level managers greater opportunities to become Jersey Mike’s franchise owners.

The transaction is expected to be completed in early 2025 subject to the satisfaction of certain closing conditions, including applicable regulatory approvals. Blackstone’s private equity strategy for individual investors is also expected to invest as part of the transaction. Guggenheim Securities and Morgan Stanley & Co. LLC are acting as financial advisors and White & Case LLP served as legal counsel to Jersey Mike’s. Barclays and Bank of America are acting as financial advisors and Simpson Thacher & Bartlett LLP served as legal counsel to Blackstone.