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Sen. Elizabeth Warren, D-Mass., took to X, the social media site formerly known as Twitter, on Sunday to applaud a federal antitrust investigation focused on the possible takeover of sandwich giant Subway.
Subway announced in late August that it had reached an agreement to sell the family-owned sandwich chain to private equity firm Roark Capital in a deal reportedly worth more than $9 billion. The company owns sandwich shops such as Jimmy John’s, Arby’s, McAlister’s Deli and Schlotzky’s.
According to a report from Politico, the private equity firm’s holdings prompted the Federal Trade Commission (FTC) to open an investigation earlier this month into whether the deal gave the company a monopoly over sandwich shops and other brands in the fast -food industry.
“We don’t need another private equity deal that could lead to higher food prices for consumers,” Warren wrote on a sandwich shop monopoly.
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Sen. Elizabeth Warren, D-Mass., expressed support for the FTC’s antitrust investigation into a private equity firm’s acquisition of sandwich giant Subway. (Portal/Evelyn Hockstein / Portal Photos)
Warren is one of the Senate’s leading antitrust hawks and has regularly called on the FTC to investigate high-profile mergers and acquisitions, such as the ongoing investigation into the Albertsons-Kroger merger.
Under FTC Chairwoman Lina Khan, the antitrust agency has not successfully blocked any proposed mergers in court. The agency’s attempt to stop Microsoft’s takeover of Activision was initially rejected by the courts and is currently being challenged.
Politico reported that mergers valued at more than $111 million typically face a 30-day review by the FTC or Justice Department — although such investigations can take longer at regulators’ discretion — and that Subway and Roark tried unsuccessfully have sought to shorten the investigation by pursuing a 30-day extension of the initial review period, citing a source familiar with the matter.
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Roark Capital’s pending acquisition of Subway is currently under review by the Federal Trade Commission. ((Photo by Michael M. Santiago/Getty Images) / Getty Images)
The New York Post noted that a 2021 Subway franchise agreement defined its competitors as quick-service restaurants within three miles of a Subway location that derive “more than 20% of their total gross revenue from sales of any type of sandwich bread.” , including, but not limited to, sub buns and other rolls, sliced bread, flatbreads, flatbreads and wraps.”
The franchise agreement specifically named Jimmy John’s, McAlister’s Deli and Scholtzky’s as competitors in the sandwich market, the Post reported. This could serve as a focal point for the FTC’s challenge to Subway’s pending sale.
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Roark Capital’s portfolio includes several other well-known fast food franchise brands, including Baskin-Robbins, Dunkin Brands, Buffalo Wild Wings and Sonic.
The company did not immediately respond to a request for comment.