Subway is exploring a sale that could value sandwich chain at $10 BILLION

The Subway sandwich restaurant chain has begun exploring a sale for the company that could be valued at $10 billion. 

The company has retained advisers in the early stages of a sales plan expected to attract corporate buyers and private-equity firms, the Wall Street Journal reports. 

Although Subway previously shot down speculations that it was preparing for a sale last year, the franchise has seen a big turn following years of controversies regarding its ingredients, including its tuna and bread, and pedophile former spokesperson, Jared Fogle. 

Following its latest reports for the end of 2021, the company is the largest restaurant chain in the US with more than 21,000 locations even after shutting down more than 2,600 franchises in the last three years as part of its restructure plan. 

Subway also saw its revenue up 13 percent to $9.4 billion at the end of 2021. 

'As a privately held company, we don't comment on ownership structure and business plans,' Subway said in a statement. 'We continue to be focused on moving the brand forward with our transformational journey to help our franchisees be successful and profitable.'

Subway has seen it franchise count in the US fall after peaking in 2015 following the death of its long-time founder and Jared Fogle's child pornography conviction 

Former Burger King CEO John Chidsey (above) took the reins from Subway's founding families in 2019, restructuring the company and rolling out a new menu focused on freshness. Experts said Chidsey's turn around has made the company an attractive asset valued at $10 billion 

Subway, which has about 37,000 stores around the world, saw a meteoric rise in the early 2000s, but after sales peaked at $18 billion in 2012, the company began stumbling. 

In 2015, Subway faced a public image nightmare when the face of the company, Jared Fogel, was convicted on child pornography charges. 

It has also faced criticisms over the freshness of its ingredients, with Ireland's Supreme Court ruling that its bread had too much sugar to be called bread.

The company also faced a class-action lawsuit claiming it was misrepresenting its tuna sandwiches, with lab analysis repeatedly showing the meals had no tuna DNA. 

The tests prove that the ‘tuna’ is actually a ‘mixture of various concoctions that do not constitute tuna, yet have been blended together by [Subway] to imitate the appearance of tuna,’ according to the complaint filed against the company. 

A judge rejected Subway's request to dismiss the lawsuit in July, with the case being reviewed in the US District Court for the Northern District of California before heading to trial.  

While Subway has been owned by its two founding families for more than five decades, John Chidsey became the first outsider CEO in 2019.

Chidsey, the former CEO of Burger King, elected to close down locations and restructure the company to focus on its menu and food quality. 

The company has since rebounded and exited the pandemic in a better condition than competitors, with the company noting that its latest quarter saw sales up 8.4 percent compared to the same time in 2021. 

The latest revenue surge came after the launch of the 'Subway Series' menu, which fulfilled Chidsey's goal of streamlining the food being served. 

Neil Saunders, managing director of GlobalData, told CNN Business that the changes have made Subway an attractive target to buyers. 

'While the program has proven itself, it still has a lot of runway to boost future growth, which makes Subway a chain with good prospects – even in a slowing economy,' he said. 'The optimistic outlook is one of the reasons Subway sees this as a reasonable time to explore a sale and why it is likely to attract a significant amount of interest.' 

Subway was founded co-found by Fred DeLuca and Peter Buck in 1965, with DeLuca (above) serving as CEO during the peak of the restaurant's popularity 

Despite years of decline, Subway

Since the prospects of the sale are still in its early phases, any deals being discussed could still be called off. 

Saunders noted that because of Subway's recent successes, interested buyers may have to offer incentives to speed up a deal. 

'While Subway is clearly interested in doing a deal, it is in no particular hurry and will likely be relaxed if nothing comes of its explorations. This means buyers will need to pay a full price to get any transaction over the line,' Saunders told CNN. 

The popular sandwich chain was founded in Bridgeport, Connecticut in 1965 by Fred DeLuca and Peter Buck. 

Buck had lent DeLuca $1,000 to open the sandwich shop, which exploded in popularity by the early 2000s over its foot-long subs. 

DeLuca manned the helm of the growth before being diagnosed with cancer in 2013, with his daughter, Suzanne Greco, taking the reins. 

Greco then retired in 2018, with Trevor Haynes serving as interim CEO until Chidsey came on board.