The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
By Jonathan Guilford
NEW YORK, Jan 10 (Reuters Breakingviews) - Cintas unveiled its unsolicited $5 bln bid for rival UniFirst, a healthy 62% premium. The suitor’s higher profitability and valuation will help it pile on pressure. It’s also a deal template that heavyweights in other industries are likely to follow as pricing power wanes.
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CONTEXT NEWS
Cintas, which sells and cleans workplace uniforms, said on Jan. 7 that it had submitted a cash offer to buy rival UniFirst for $275 a share, or $5.3 billion, adding that it first offered $255 in February 2022.
UniFirst confirmed it had rejected the offer, which it described as “highly conditional,” after hearing from some of its largest shareholders by voting power. The Croatti family has 70% control of the company through its super-voting Class B shares.
(Editing by Jeffrey Goldfarb and Pranav Kiran)
((For previous columns by the author, Reuters customers can click on GUILFORD/ Jonathan.Guilford@thomsonreuters.com))
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