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The Kentucky-based company, which ranks as the world’s third-largest pizza chain, is now seeking an investor rather than an outright buyer, Reuters reported, citing sources familiar with the matter. Papa John’s abandoned plans for a sale after initial offers failed to match internal valuations of the company.
Papa John’s, which has been embroiled in a lengthy legal battle with its ousted founder, John Schnatter, reportedly received offers from Bain Capital, KKR, CVC Capital Partners and other major private equity firms. According to Reuters, the company would use any investment to fuel efforts to boost profitability among franchisees.
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The pizza chain had formed a special committee composed of members of Papa John’s board of directors to examine potential options for the company’s future. Schnatter still holds a seat on the company’s board and is also its largest shareholder, owning roughly 30 percent of all shares.
Schnatter was forced to resign as Papa John’s chairman last year after he admitted to using a racial slur during a conference call with marketing executives. Papa John’s executives blamed Schnatter’s remark, as well as his previous public criticism of the NFL, the company’s former corporate partner, for a lengthy sales slump.
Schnatter has a pair of pending lawsuits against Papa John’s over future control of the company.