This deal, valued at approximately $8 billion including debt, highlights the rising interest of private equity firms in franchise operators. The agreement is set to finalize in early 2025, according to Jersey Mike's announcement on Tuesday.

The acquisition comes on the heels of another major deal in the sandwich sector. Last year, Roark Capital, another private equity company, purchased Subway for a transaction valued up to $9.55 billion. Jersey Mike's, known for its submarine sandwiches, has been a staple in the American fast-casual dining scene since its inception.

Jersey Mike's has a storied history, originating in 1956 when founder Peter Cancro began working at the Point Pleasant, NJ, location originally named Mike's Subs. Cancro acquired the location in 1975 and began franchising in 1987. Under his leadership, Jersey Mike's has expanded to over 3,000 locations nationwide, with more in development.

Peter Cancro, who will retain an equity stake and continue to lead Jersey Mike's, expressed optimism about the partnership with Blackstone. "We believe we are still in the early innings of Jersey Mike's growth story and that Blackstone is the right partner to help us reach even greater heights," Cancro stated.

Blackstone, the world's largest alternative asset manager boasting over $1.1 trillion in assets, has been actively investing in the food franchise sector this year. In February, Blackstone made an equity investment in 7 Brew Coffee to support its expansion. Subsequently, in April, the firm agreed to acquire Tropical Smoothie Cafe from private equity firm Levine Leichtman Capital Partners.

"Blackstone has deep experience helping accelerate the expansion of high-growth franchise businesses and this area is one of our highest-conviction investment themes," noted Peter Wallace, a senior managing director at Blackstone. The investment firm has a notable track record with franchise businesses, including its 2007 acquisition of Hilton Hotels and investment in Servpro, a cleanup and emergency restoration franchise.

Advising Jersey Mike's on the transaction were Guggenheim Securities, Morgan Stanley, and White & Case. On the other side, Barclays, Bank of America, and Simpson Thacher & Bartlett provided counsel to Blackstone.