ADW Capital pushes Driven Brands for strategic review with $18 offer

Key Takeaways:

ADW Capital, a 4.8% holder, demands Driven Brands launch a strategic review
The activist offered $18 a share, a 40% premium to the current price
ADW accuses controlling shareholder Roark Capital of misaligned incentives

ADW Capital Management, which owns about 4.8% of Driven Brands Holdings Inc., sent an open letter to the board and controlling shareholder Roark Capital Group demanding the company immediately start a strategic review process, including a potential sale.

"The problems are hiding in plain sight," Adam Wyden, managing member of ADW Capital, said in the letter dated June 9. "Governance issues, a spending problem, accounting failures — how can anyone possibly expect the public markets to trust this team and this structure?"

Driven Brands shares have fallen by a double-digit percentage this year while the broader market has gained nearly 10%, the letter said. The company is still not current on its financial filings. ADW previously offered $18 a share for the company — a 40% premium to the current trading price — and was met with silence, Wyden wrote.

Roark Capital, which owns more than 60% of Driven, has incentives that are "diametrically opposed" to those of public shareholders, ADW argued. The activist pointed to Roark's Fund IV, which has returned just 0.25x as of September 2025 with a roughly 7% IRR after a decade, and Fund III, which is nearly 15 years old. ADW said selling Driven could return nearly $2 billion in cash to Roark's limited partners.

The activist also questioned governance at the company, noting that one of Roark's investment professionals is the son of former Chief Executive Officer and current Chairman Jonathan Fitzpatrick. ADW said it will continue to push publicly for a sale, particularly as Roark prepares to take its "crown jewel" asset Inspire Brands public.

The standoff puts Driven's independent board members in a difficult position. Each of them owes a fiduciary duty to minority shareholders, ADW said, while Roark controls the voting majority. The next catalyst for investors will be whether the board formally responds to ADW's offer or whether the activist escalates its campaign further.

This article is for informational purposes only and does not constitute investment advice.