- John Schnatter is reaching out to private equity firms to discuss partnering to buy out Papa John's, sources tell CNBC.
- Schnatter was ousted from his chairman role earlier this year when racially charged comments he made on a conference call leaked to the press.
- Schnatter owns roughly 30 percent of Papa John's, but private equity firms are concerned about the reputation risk of partnering with him, the sources say.
John Schnatter is having trouble letting go.
The ousted founder of the Papa John's PZZA pizza chain has reached out to a number of private equity firms in recent weeks to discuss partnering in a bid to buy the company, sources familiar with the situation tell CNBC.
Schnatter, who already owns roughly 30 percent of Papa John's, is looking for capital to help support an offer, sources say. Several private equity firms have turned him down though, concerned about of the reputational risks inherent in partnering with him. Meantime, those interested in buying Papa John's do not believe that working with Schnatter is the best path towards a winning offer, some of the sources say.
Schnatter was ousted as chairman earlier this year, when racially charged comments he made on a conference call leaked to the press. Since then, he has been locked in a bitter battle with the company's board, whom he has accused of staging a coup to force his exit. The restaurant chain also adopted a defense mechanism known as a "poison pill" to prevent a hostile takeover from Schnatter or others.
As it grapples with its public relations crisis, shares of Papa John's have fallen nearly 40 percent over the past year. The restaurant chain earlier this year hired Bank of America BAC and Lazard LAZ as financial advisors as it looks to clean up the mess.
The sources requested anonymity the information is confidential. Schnatter wasn't immediately available, Papa John's declined to comment.
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