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M&A News: Papa John’s Stock Blasts Off on $2B Take-Private Talks

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Apollo Global and Qatar’s Irth Capital Management have made an offer to take Papa John’s private in a deal valued at approximately $2 billion.

M&A News: Papa John’s Stock Blasts Off on $2B Take-Private Talks

Shares of pizza chain Papa John’s International (PZZA) soared over 15% in intra-day trading yesterday on news of a takeover bid from Apollo Global (APO) and Qatari investment fund Irth Capital. The two private equity (PE) firms have made a combined offer of roughly $2 billion, representing a takeover offer in the low $60s per share. The news was first reported by Semafor, citing people familiar with the matter. PZZA stock ended the day up 7.5% on June 11.

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Why Is Papa John’s Attracting a Hefty Premium?

As of date, PZZA’s market capitalization stands at $1.6 billion, and its stock price closed at $48.20 before the acquisition news, implying a roughly 24% premium to Tuesday’s closing price. The exact details of the offer remain unknown at the moment.

Papa John’s, hailed as the third-largest pizza delivery brand globally, has consistently beaten earnings expectations in seven of the eight past consecutive quarters. The company is making solid efforts to improve its margins, while its revenue has remained stable over recent quarters. Moreover, PZZA trades at a discount to its peers Yum! Brands (YUM) and Domino’s Pizza (DPZ), making it an attractive investment opportunity.

Apollo and Irth Have United in an Unusual Partnership

Irth Capital is a small fund backed by Sheikh Mohamed al Thani of the Qatari royal family. The firm managed some $190 million of assets as of December 31, 2024. Although smaller compared to the giant PE firm Apollo, Irth already holds a 5% stake in Papa John’s, making it an apt suitor for the bid. Additionally, Irth has expertise in turning around consumer brands, such as mattress brand Casper and fried-chicken chain Bojangles. There were rumours about Irth’s interest in acquiring Papa John’s in February as well, when PZZA stock jumped 20%.

Meanwhile, Apollo Global is a large listed PE firm, with a current market capitalization of $82.8 billion. As of March 31, 2025, APO managed fee-generating assets (FGAUM) of $595 billion. Notably, the report suggests that Irth is yet to finalize its funding arrangements for the potential deal. In that case, Apollo could still proceed with the acquisition independently.

Is Papa John’s Stock a Good Buy?

On TipRanks, PZZA stock has a Moderate Buy consensus rating based on four Buys and three Hold ratings. Also, the average Papa John’s International price target of $47.33 implies 8.6% downside potential from current levels. Year-to-date, PZZA stock has gained 29.1%.

See more PZZA analyst ratings

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