Little did the late Subway co-founders Fred DeLuca and Peter Buck imagine decades ago that their Bridgeport, Conn., sandwich shop would grow into one of the world’s largest restaurants. But now their descendants could become some of the richest people in America.
The sandwich giant is exploring a sale that could value it at more than $10 billion and has retained advisers with that in mind, according to the organization. Wall Street Journalciting people familiar with the situation
A Subway spokesperson wrote Fortune:“As a private company, we do not comment on ownership structure and business plans. We remain focused on driving the brand forward on our transformational journey to help our franchisees be successful and profitable.”
In 1965, a teenage DeLuca asked family friend and nuclear physicist Buck for advice on financing his college education, according to Insider. This led to Buck lending him $1,000 to open a sandwich shop, a move that eventually made both men billionaires.
DeLuca led the company for decades as it expanded rapidly in the US and internationally. Buck became a largely silent co-owner after the company switched to a franchise model in 1973.
From its humble beginnings as a Pete’s Super Submarines store that actually paid for DeLuca’s University of Bridgeport education, the company went on to dwarf McDonald’s (and all other restaurant chains) in terms of U.S. outlets. Its roughly 21,000 domestic locations posted sales of $9.4 billion in 2021, up 13 percent from 2020, and it had about 37,000 stores worldwide, according to the data. Magazine.
Metro has remained a private business throughout, with two families behind the scenes. After DeLuca was diagnosed with leukemia and died in 2015 at age 67, his sister, Susan Greco, became CEO until she retired in 2018.
In 2019, the company finally brought in an outsider, choosing former Burger King CEO John Chidsey to take the helm.
By: MagazineA sale of Subway could attract both private equity firms and corporate buyers, sources said.
Because Subway has never gone public, its finances, and how much money was given to DeLuca, Buck and their relatives, have never been open to public scrutiny.
But how Bloomberg Hints have reportedly surfaced here and there on Thursday. By the time of his death in 2021 at the age of 90, Buck had become one of the largest landowners in the United States, and he was fighting the IRS over giving land to his sons at a deep discount.
In the early 2000s, DeLuca collected $1 million a day in royalties, according to a 2017 deposition by banker Fran Saavedra, Insider reported. Despite his wealth, he remained frugal, to the surprise of some relatives.
Now, if the sale of the company goes through, both men’s families could be significantly richer. It’s unclear which families are waiting for the windfall, but DeLuca, for one, is survived by his son, John, who serves as the Frederick A. Director of DeLuca Foundation and, according to 2021 Fort Lauderdale Illustratedis raising children with television personality Kavita Channe.
This story originally appeared on Fortune.com
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