Romney’s Bain made big profit from the pizza chain, but left it saddled with debt
In 1998, Bain Capital, led by Mitt Romney, bought Domino’s for $1.1 billion, investing $385 million in cash and borrowing the rest.
Domino’s was not in need of rescue, nor was it a classic turnaround case for Bain. But it was still a bonanza for the Boston leveraged buyout firm, which makes money by buying and selling businesses. Bain reaped a 500 percent return on its investment in the nation’s largest pizza delivery chain over 12 years.
Domino’s grew its revenues and earnings under Bain, but its debt also surged to $1.5 billion, leaving the chain with a higher debt ratio than most of its rivals, and interest payments that eat up half its profit each year.
Near the end of Bain’s involvement with Domino’s, the chain’s pizza quality became an issue. Domino’s reworked its pizza in ’09 after ranking last in taste.