The Dunkin' doughnuts and coffee chain confirmed it's held talks to be taken private by a private equity firm, sending shares rocketing to an all-time high at the opening bell Monday.
Dunkin' Brands Group said it's in preliminary discussions with Inspire Brands, which also owns Arby's and Jimmy John's Sandwiches. In a prepared statement Sunday, Dunkin' said it was not yet certain a deal would be reached and would not comment further.
"Dunkin' Brands confirms that it has held preliminary discussions to be acquired by Inspire Brands," Karen Raskopf, a Dunkin' spokeswoman, said in a statement, declining to offer further details and cautioned that there's is no certainty an agreement will be reached.
Inspire Brands said it had no comment Monday, but Dunkin' shares jumped 16% to $103.10.
Dunkin', based in Canton, Mass., also owns the Baskin-Robbins ice cream chain. There are 13,000 Dunkin' stores and 8,000 Baskin-Robbins outlets worldwide.
But the global pandemic has hurt sales. Dunkin' Brands revenue fell 20% in the second quarter, and the company said franchisees closed 200 restaurants permanently. Dunkin' Brands reported full-year sales of $1.4 billion in 2019, up 4% from the previous year.
Both brands have significant history. Dunkin' was founded in 1950 in Quincy, Mass. Baskin-Robbins -- known for its promise of 31 flavors -- was founded in 1945 in Glendale, Calif.
Shares of Dunkin' Brands have more than doubled since March on investor optimism that its mobile ordering app and loyalty program boosted sales during the pandemic. The company dropped the word "Donuts" from its name in 2018, signaling its broadened focus on beverages.
The number of coffee shops in the U.S. is shrinking for the first time in nine years as sales plunge and covid-19 forces the industry to rethink its business. While that's helped Dunkin' and other coffee-serving chains such as Starbucks Corp. and even McDonald's Corp. gain ground at the expense of independent outlets, it's not enough keep all its stores operating.
Atlanta's Inspire Brands, which was founded in 2018, has quickly placed itself among the largest restaurant groups in the U.S. It also owns the Buffalo Wild Wings and Sonic burger chains, and has annual sales of more than $14 billion.
Dunkin' would give Inspire a spot in the breakfast category, which was the fastest-growing segment of the restaurant industry before the pandemic hit.
Inspire is part of the private equity company Roark Capital Group, also based in Atlanta. Roark also backs Focus Brands -- the owner of Auntie Anne's Pretzels and Cinnabon -- and CKE Restaurants, which owns the Carl's Jr. and Hardee's burger chains.