The parent company of Arby's is buying Jimmy John's Sandwiches, hoping to reverse sluggish sales at the chain.
Atlanta-based Inspire Brands said Wednesday the acquisition will make it the fourth-largest restaurant company in the U.S., with annual sales of $14 billion and 11,200 restaurants. Inspire also owns Sonic, Buffalo Wild Wings and Rusty Taco.
Jimmy John's founder and chairman, Jimmy John Liautaud, will step down and become an adviser to Inspire's board. James North, Jimmy John's president and CEO, will serve as president and report to Inspire CEO Paul Brown.
Like Papa John's founder John Schnatter, who was forced out as chairman in 2018 because of racist comments, Liautaud has been a liability for Jimmy John's in recent years. Actor Mark Hammill is among those who have called for a boycott of Jimmy John's on Twitter after social media photos showed Liautaud posing with an elephant and a leopard he had killed on hunting trips.
FILE - In this June 23, 2011 file photo, Jimmy John Liautaud, founder of the Jimmy John's sandwich chain, poses for a photo in Champaign, Ill. The parent company of Arby's and Buffalo Wild Wings is buying Jimmy John's Sandwiches. Jimmy John's founder and chairman, Liautaud, will step down and become an adviser to Inspire's board. Liautaud, a hunter, has been a liability for the company in recent years after social media photos showed him with an elephant and a leopard he had killed. (John Dixon/The News-Gazette via AP, File)
Oct 25, 2012 - Jimmy John's driver Jordan Foutch runs to his car to make a delivery during the lunch rush recently.Sales of Jimmy John's, which operates four stores in Chattanooga, totaled $2.15 billion in 2018. That was flat from 2017 and up 1% from 2016 even though Jimmy John's added 156 stores in that period, according to Technomic, a restaurant data firm. Jimmy John's has 2,800 locations in 43 states and 84,000 employees. The chain was founded in 1983 in Illinois.
Inspire said it can help Jimmy John's with product development, marketing and stronger purchasing scale. The company said Jimmy John's also has a lot of potential for international expansion.
"We're more interested in growing the brand and supporting the Jimmy John's system than we are in the past, personal hobbies of any single individual," Inspire said in an email when asked about Liautaud.
Roark Capital, the private equity firm that owns Inspire Brands, had already purchased a majority stake in Jimmy John's in 2016.
The deal is expected to be completed by the end of October. Terms weren't disclosed.
In a Business Insider interview published Tuesday, Inspire Brands CEO Paul Brown said that after an acquisition, he meets "with as many stakeholders associated with the brand as possible: franchisees, restaurant employees, customers, suppliers. And rather than walking in with answers and process solutions, I start by asking fundamental questions like, 'What part of the business is working well?' 'What is your biggest challenge?'"