Private equity firm Roark Capital has signed a deal to acquire Dave’s Hot Chicken for approximately $1bn, strengthening its already significant presence in the restaurant industry through Arby’s, Culver’s, and Subway, according to a report by Reuters.
The report cites unnamed sources familiar with the matter as highlighting that Atlanta-based Roark Capital, which manages $38bn in assets, has been drawn to franchise restaurant operators due to their steady royalty revenue and relatively low operating costs.
The deal comes as restaurant chains, including Dave’s Hot Chicken, face increasing labour costs and inflationary pressures — prompting many to adjust menu pricing to maintain profitability.
Founded in Pasadena, California, Dave’s Hot Chicken has gained popularity for its Nashville-style hot chicken and has capitalised on the increasing consumer demand for chicken-based fast food.
The chain operates over 250 locations worldwide and generates approximately $1bn in annual sales.
Its founders, Dave Kopushyan, Arman Oganesyan, Tommy Rubenyan, and Gary Rubenyan, retain a majority stake in the company. Among its high-profile investors is rapper Drake, who has helped boost the brand’s visibility.
Dave’s Hot Chicken had been working with investment bank North Point on a sale process and had drawn interest from multiple private equity firms, as Reuters previously reported.
Neither Roark Capital, Dave’s Hot Chicken, nor North Point have commented on the transaction.
