POTBELLY has just been bought by a convenience store chain for $566 million, which could help it to quadruple its restaurant count.
The sandwich chain has been acquired by RaceTrac in a deal that chiefs hope will enable Potbelly to grow from 445 to 2,000 restaurants.
Potbelly has been acquired by RaceTrac[/caption]
Chiefs have confirmed that the two brands will stay separate once the deal has gone through.
Potbelly Chief Executive Robert Wright confirmed in a statement that the deal will not result in the unification of Potbelly and RaceTrac.
He said: “Their strategy isn’t necessarily to put a Potbelly in every RaceTrac.”
Instead, RaceTrac will be adding Potbelly to its line-up of convenience-based brands.
RaceTrac operates more than 800 RaceTrac and RaceWay locations in 14 states.
Potbelly CEO Bob Wright further hinted that the company would be remaining true to its identity.
He added: “With RaceTrac’s resources, we will unlock new opportunity for this incredible brand while staying true to the neighborhood sandwich shop experience that makes Potbelly special.”
Potbelly wants to grow, and since the announcement, there are already signs that this is possible.
Since the announcement on Wednesday, Potbelly’s shares have risen by 31% to roughly $17 each.
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The deal, which is expected to be finalizaed in the fourth quarter of the year, came together quicker than it normally would.
This is because RaceTrac made an unsolicited approach to Potbelly, which allowed the deal to be expedited.
Potbelly opened its first location in Chicago in 1977.
It has an additional 105 franchised locations throughout the country.
RaceTrac’s acquisition marks its second major one in two years, following its deal with Gulf Oil in 2023.
In addition to its portfolio of 800 RaceWay and RaceTrac stores, it has 1,200 Gulf-branded locations in the US.
CONVENIENCE CLOSURE
But some convenience store chains are falling victim to the tough economic environment.
The chain that was known in the Midwest as The Store closed all of its 25 locations at the end of July.
The company had stores in Mountain Express Oil gas stations across Wisconsin and Michigan.
But Mountain Express Oil went bankrupt last year, and the buildings were sold off to a property investment company, according to local CBS affiliate WSAW.
The company did not have any plans to renew the agreement with The Store.
However, the chain is trying to make a deal with the new property owners that would allow all of its employees to stay on.
Chiefs have confirmed that the two brands will stay separate once the deal has gone through[/caption]
