The chain is in the midst of a years-long comeback effort after being sold in 2017 for $565 million.
Bob Evans is reportedly looking into a sale that could value it at up to $600 million, according to Bloomberg.
Private equity firm Golden Gate Capital, also the owner of California Pizza Kitchen and Red Lobster, purchased the casual-dining chain for $565 million in 2017. The acquisition came after Bob Evans saw a 2.5 percent same-store sales decline and closed 41 stores in 2016.
In July, CEO Saed Mohseni told FSR that restaurants avoided massive sales declines in the early months of COVID, and projected $780 million in sales and north of $65 million in EBITDA for fiscal 2021, which he described as "somewhat historic numbers." He attributed these results to a years-long turnaround strategy that included simplifying the menu to focus on core menu items, revamping the chain's value proposition, shifting toward digital marketing platforms, partnering with third-party delivery companies, and launching a new ad campaign showcasing farmers.
As part of those efforts, restaurants invested in hospitality training for off-premises business and shifted physical spaces to be more efficient with takeout orders. Stores also changed more than 70 ingredients throughout the menu and eliminated those that couldn't be cross-utilized very well.
"When we talk about—and I don't really like the word 'turnaround'—when we talk about continued improvement of the company, that continued improvement really started by making operations focused on a menu that was relevant to the consumer, and having a marketing plan that really focused on us reminding people that Bob Evans was born on a farm, and it's really about fresh products,” Mohseni said in July.
At the time, Bob Evans had roughly 480 stores, down from approximately 520 in 2017.
Bloomberg reported Golden Gate and the restaurant are working with financial advisers. A source told the outlet that Bob Evan's $65 million EBITDA figure implies a valuation as much as $600 million because family-dining chains are valued at a multiple in the high single digits.
Golden Gate hasn't decided whether to go through with a deal, and could decide to keep the restaurant.
Several restaurants exchanged hands in casual-dining segment last year, as operators and private equity firms capitalized on opportunities. This includes FAT Brands' $300 million purchase of Twin Peaks, Logan Roadhouse parent SPB Hospitality's $220 million acquisition of J. Alexander's, and Famous Dave's parent BBQ Holdings' purchase of Village Inn, Bakers Square, and Tahoe Joe's Steakhouse.