Jersey Mike’s is set to raise $400m through a whole business securitisation (WBS) as the sandwich chain looks to return capital to Blackstone, which acquired a majority stake in the company earlier this year in a deal valuing it at approximately $8bn, according to a report by Bloomberg.
The asset-backed securities, expected to be rated BBB by both S&P Global Ratings and Kroll Bond Rating Agency, will be backed by franchise fees, royalties, and trademarks tied to the company’s US operations, according to a source familiar with the matter.
This marks Jersey Mike’s second WBS issuance in under a year. The chain last tapped the market in December 2023 with an $850m offering to support the leveraged buyout led by Blackstone, which closed in January. The brand also completed $500m WBS deals in 2019 and 2021.
Approximately 99% of Jersey Mike’s locations are franchised, with same-store sales growing 5% in Q1 at stores open at least a year, the source said.
Whole business securitisations have become a favoured financing tool for franchise-heavy models, offering issuers access to lower-cost capital by granting bondholders direct claims on core brand assets.
Guggenheim Securities is acting as sole structuring agent on the deal. Jersey Mike’s and Blackstone declined to comment.
