Blackstone is set to acquire a majority stake in Jersey Mike's Subs for a reported $8 billion, underscoring private equity’s growing appetite for franchised restaurant chains with strong growth potential. Jersey Mike’s, the second-largest U.S. sandwich chain with over 3,000 locations in operation or development, aims to leverage Blackstone’s financial backing to accelerate domestic and international expansion while enhancing its digital and technology capabilities. The deal reflects a broader trend of private equity targeting franchise-led growth opportunities in the dining sector, as seen with recent acquisitions of Subway and Tropical Smoothie Cafe. While the restaurant industry faces challenges, Jersey Mike’s has outperformed peers in traffic and same-store sales. However, this investment comes at a time of increasing competition, particularly from Subway, which recently unveiled a global redesign. Jersey Mike’s founder and CEO, Peter Cancro, will retain significant equity and leadership, continuing a growth trajectory that began in 1975.

Spirit Airlines, once a trailblazer in ultra-low-cost travel, has become the largest U.S. passenger airline to declare bankruptcy in over a decade. Known for pioneering the à la carte pricing model that made air travel accessible to cost-conscious flyers, Spirit’s bright yellow planes became synonymous with affordable fares and a no-frills experience. However, the airline's fortunes waned following losses of over $2.2 billion since 2020, driven by rising labor costs, fleet issues, and intense competition from larger carriers. Spirit’s attempt to merge with JetBlue, blocked by antitrust regulators, further constrained its ability to recover. CEO Ted Christie blamed the “rigged game” of airline competition that favors industry giants. While Spirit restructures in bankruptcy, it plans to continue flying and adapt its business model to attract more premium customers, aiming to emerge as a stronger competitor. Analysts speculate on whether Spirit will remain independent or seek new partnerships post-restructuring.

U.S. lenders are navigating a paradoxical moment in the credit market: high interest rates on loans offer lucrative returns, yet borrowing demand remains subdued. Despite record-high credit card rates, consumer appetite for debt has been restrained, with household debt growing slower than GDP in the third quarter and inflation-adjusted debt levels well below their 2008 peak. Delinquencies, while elevated, are stabilizing, with signs of improvement in the fourth quarter. However, banks face a conundrum as subdued loan demand and potential Fed rate cuts could pressure revenues. To sustain growth, lenders may turn to riskier borrowers, a strategy reminiscent of past mistakes that fueled higher loss rates during the pandemic recovery. While current economic stability has mitigated risk, future downturns marked by significant job losses could pose severe challenges. Balancing profitability and prudence, banks must tread carefully to avoid jeopardizing long-term stability.

Portfolio trading in the US corporate bond market has surged, revolutionizing how investors access fixed-income assets. A new report by Barclays reveals that portfolio trades—baskets of bonds bought or sold in a single transaction—now occur every seven minutes, with 2024’s trading volume projected to hit $1.2 trillion, double last year’s total. This method, previously rare due to the unique nature of individual bonds, is now enabled by advances in pricing algorithms and the rise of electronic trading. Portfolio trading's integration with bond ETFs has created a "virtuous cycle of liquidity," driving demand for underlying bonds and enabling systematic credit strategies. Notably, the approach is reshaping market dynamics by improving liquidity for less-traded bonds, reducing the percentage of non-traded investment-grade corporate bonds to near zero. As portfolio trading becomes integral to fixed-income markets, its rapid adoption signals a transformative shift in credit market accessibility and efficiency.