Papa John's International, the world's third-largest pizza delivery company, is pursuing the sale of a stake in itself after acquisition offers it received from private equity firms did not meet its valuation expectations, people familiar with the matter said on Friday.
Any such deal would come amid a battle for control of Papa John's with the chain's founder John Schnatter, who owns about 30 percent of the company. Schnatter resigned as chairman in July following reports that he had used a racial slur on a media training conference call. He retains a seat on the company's board.
The transaction, which could be structured as a private investment in public equity, would boost Papa John's finances, the sources said, as the Louisville, Kentucky-based company seeks to recover from low franchisee profitability and boost its sales through promotional discounts.
There is no certainty that Papa John's will agree to any deal, the sources said, asking not to be identified because the matter is confidential. Papa John's declined to comment.
Shares were down nearly 8 percent to $39.00 in Friday morning trading.