"Sandwich Shop Monopoly": Biden's FTC Probing $10 Billion Subway Merger

Having solved all of the country's other problems, the Biden administration is now making sure evil sandwich shops aren't colluding in dark capitalist board rooms to exploit the everyday American sandwich eater. We feel safer already.

And just when you thought you've heard every single wonderful tale in government efficiency possible, some agency finds a way to outdo itself. This time it's Lina Khan's FTC, which is looking into a potential "sandwich shop monopoly" as Roark Capital's $10 billion pending purchase of sandwich chain Subway hangs in the balance.

The regulator is apparently concerned because Roark also owns Jimmy Johns and Arby's. Oh, the horror...

The reason for concern, according to Yahoo Finance, is "whether the addition of Subway gives Roark too much control of a lucrative segment of the fast food industry". It's almost as if they've never heard of a restaurant group...

According to Politico, who broke the story, the companies are urging the FTC to broaden its perspective beyond just sandwiches, emphasizing the extensive variety of options available to consumers in the fast food market.

The FTC's probe into the merger, which began earlier this month, is still in its preliminary phase, with a resolution expected to take several months. The companies' attempt to avert a lengthy investigation by extending the initial review period by 30 days was unsuccessful.

The FTC's inquiry represents a heightened emphasis under Chair Lina Khan on private equity transactions and the pricing of essential consumer goods, the report said.

For example, in September, the FTC initiated legal action against a consortium of Texas anesthesia practices and their private equity owner, alleging that their acquisitions unlawfully monopolized the market.

Additionally, the agency is examining the forthcoming merger between supermarket chains Kroger and Albertsons, with a decision on whether to contest the merger anticipated in the near future.

Politico added that antitrust reviews typically last over a year, during which the FTC can either challenge, negotiate terms with the companies, or opt not to act. 

Roark, a private equity firm, finalized an agreement in August to acquire Subway. According to a Reuters report, the transaction assigns a value of as much as $9.55 billion to the American sandwich franchise, this figure includes its debts. Roark is known for overseeing Inspire Brands, which manages several dining chains such as Jimmy John's, Arby's, Baskin-Robbins, and Buffalo Wild Wings.