TLDR
- Irth Capital Management has submitted a bid to take Papa John’s private at $47 per share
- The offer values Papa John’s at ~$1.5 billion, a 50% premium to pre-bid trading levels
- Brookfield Asset Management is backing the Irth Capital bid
- PZZA stock closed up ~19% on Wednesday at $38.86 after the WSJ broke the news
- This is the third takeover rumor in six months; a previous Irth/Apollo deal fell apart last year
Papa John’s stock surged nearly 19% on Wednesday after reports emerged that a Qatari-backed investment fund had submitted a formal bid to take the pizza chain private.
Papa John’s International, Inc., PZZA
The Wall Street Journal first reported that Irth Capital Management, backed by Brookfield Asset Management, offered $47 per share for Papa John’s International. That values the company at roughly $1.5 billion.
The offer price is about 50% above where PZZA was trading before news of the bid surfaced. Papa John’s had a market cap of around $1 billion going into Wednesday.
Trading in PZZA was briefly halted during the session due to a circuit breaker being triggered as the stock spiked on the news. It closed the day at $38.86.
Papa John’s is currently reviewing the proposal. There is no guarantee the company will accept the offer, and another bidder could still emerge.
This isn’t the first time Irth has tried to buy Papa John’s. The fund attempted to acquire the chain last year alongside Apollo Global Management, but those talks fell apart without a deal.
Irth is an existing Papa John’s investor and recently increased its effective stake to around 10%. The fund was founded in 2024 and is backed by Sheikh Mohamed bin Abdulla Al-Thani, a member of the Qatari royal family and formerly of the Qatar Investment Authority.
Its co-founder Matthew Bradshaw previously ran Durational Capital Management. The team also includes Mack Abbot, a former Starboard Value employee — the activist fund that previously held a stake in Papa John’s.
A Chain Under Pressure
A deal for Papa John’s would be one of Irth’s first major transactions. For Papa John’s, it comes at a difficult moment.
The chain said last month it would close hundreds of domestic locations, cut menu items, and reduce corporate headcount as part of a turnaround effort. North American same-store sales are expected to fall this year.
PZZA stock has lost around 55% of its value over the past five years. It peaked above $140 in 2021 and has been under sustained pressure since.
Papa John’s has faced years of operational challenges, partly stemming from controversy around its founder John Schnatter. He stepped down as CEO in 2017 following a series of controversial public statements, and later resigned as board chairman. Sales took a hit in the aftermath.
Analyst View
Eight Wall Street analysts currently cover PZZA, with a consensus Moderate Buy rating. That’s made up of three Buy and five Hold recommendations issued in the last three months.
The average price target sits at $42.57, which implied roughly 10% upside from Wednesday’s close — before accounting for the bid price of $47.
Papa John’s stock closed Wednesday at $38.86, still well below the $47 per share Irth has offered.
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