Blackstone buys Jersey Mike's sandwich chain

Blackstone announced Tuesday it will acquire sandwich chain Jersey Mike's Subs.

The asset management firm said the majority ownership stake will be purchased by its "most recent flagship private equity vehicle" and other funds it manages.

Blackstone aims to complete the purchase early next year.

Reuters reported that the deal values the company at around $8 billion, including debt.

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Blackstone said in a press release that the partnership 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."

Blackstone’s private equity strategy for individual investors will also be involved in the deal for the sandwich chain, according to the asset management firm.

"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," Jersey Mike's CEO Peter Cancro said in a statement.

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Cancro will continue leading the sandwich chain and will keep a "significant equity stake," according to Blackstone.

Jersey Mike's, known for its submarine sandwiches, traces its roots to 1956, when Cancro started working at the company's Point Pleasant, New Jersey, location, which was founded as Mike’s Subs.

Cancro acquired the location in 1975 and began franchising sites in 1987. Today, Jersey Mike’s footprint spans over 2,800 sandwich shops, with nearly 300 others "coming soon," according to the company's website.

Some recent franchise investments that Blackstone has made include Tropical Smoothie Cafe and 7 Brew Coffee.

"Blackstone has deep experience helping accelerate the expansion of high-growth franchise businesses, and this area is one of our highest-conviction investment themes," Peter Wallace, Blackstone's senior managing director, said in a statement.

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Other firms have also made moves in the space. One of Jersey Mike’s competitors, Subway, was bought by Roark Capital in a deal that closed earlier this year.

For traditional Jersey Mike’s locations, the average unit volume is $1.3 million, according to the chain’s website.

Reuters contributed to this report