Shake Shack, the fast-food restaurant chain that has developed a cult following for its 'Shackburgers', 'flat-top' hot dogs and eponymous shakes, has selected JPMorgan Chase & Co (NYSE:JPM) and Morgan Stanley (NYSE:MS) to lead a proposed initial public offering, according to people familiar with the matter.
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The potential offering, which could come as soon as this year according to the people, would be the biggest public event for a company that started out of a hot dog kiosk in New York's Madison Square Park in 2004.
While Shake Shack is expected to post earnings of around $20 million next year and the size of the IPO is likely to be small, underwriting one of the biggest burger names in the United States is a plum assignment for investment banks JPMorgan and Morgan Stanley.
Shake Shack's majority owner, Union Square Hospitality Group LLC, interviewed investment banks in recent weeks to appoint underwriters for the IPO, Reuters first reported last week.
Representatives for Shake Shack, Union Square Hospitality, JPMorgan and Morgan Stanley did not immediately respond to requests for comment.
Shake Shack would likely be the most-followed IPO out of a string of casual dining chains that have gone public this year. They include El Pollo Loco Holdings Inc <LOCO.O>, Zoe's Kitchen Inc <ZOES.N> and Papa Murphy's Holdings Inc <FRSH.O>.
Shake Shack is present in many U.S. states including New York, New Jersey, Connecticut, Pennsylvania, Florida and Massachusetts. It has also expanded internationally in cities such as London, Istanbul, Moscow and Dubai.
The company does not franchise and says it has no plans to do so in the future. Shake Shack's chief executive is Randy Garutti, a Cornell University graduate who worked his way up at Union Square Hospitality from general manager at its restaurants to lead Shake Shack.
Union Square Hospitality was founded by restaurateur Danny Meyer in 1985. It also runs other popular New York eateries, including Blue Smoke, Gramercy Tavern and Union Square Cafe.
Private equity firm Leonard Green & Partners LP agreed to acquire a 39.5 percent stake Union Square Hospitality in 2012 for an undisclosed amount.