Cintas offers to buy uniform supplier UniFirst for $5.3 billion

(Reuters) -Cintas on Tuesday proposed to buy UniFirst (NYSE:UNF ) for about $5.3 billion, after its repeated overtures to take over the uniform supplier were rejected by the company's board.

Cintas (NASDAQ:CTAS ) said it had offered $275 for each outstanding common and Class B share, representing a 62.4% premium to UniFirst's last closing price. Cintas added that it first made the buyout proposal to UniFirst's board on Nov. 8.

Shares of UniFirst surged nearly 33% to $224.65 in early trading, while Cintas rose about 3%.

The uniform rental firm said its latest move follows multiple attempts to engage the company's board in a "collaborative discussion," including increasing the offer price and exploring alternatives.

"While we would have preferred to have discussions with UniFirst in private, this is the second time in nearly three years that UniFirst has refused our constructive attempts to engage on an extremely compelling offer," Cintas CEO Todd Schneider said.

UniFirst, whose founding Croatti family members have about 70% of voting power, did not immediately respond to a Reuters request for comment.

Cintas also called for UniFirst's controlling shareholders and board to immediately engage to reach a mutually acceptable definitive agreement.

UniFirst and fellow uniform maker Vestis were in talks for a potential buyout by French workplace supplies provider Elis SA last year, before Elis ended the talks in October.

Cintas, which has a market capitalization of roughly $75 billion, said that the potential deal would help scale the company's operations and tackle increasing competition.

UniFirst is set to report first-quarter results tomorrow, while Cintas had raised its forecast for full-year profit after beating estimates for second-quarter earnings last month.

Source: Investing.com