PHILADELPHIA — Aramark, a provider of services in food, facilities management and uniforms based here, has entered into a definitive agreement to acquire AmeriPride Services, a textile rental and supply company based in Minnetonka, Minn., the company reports.
“AmeriPride is a highly respected company with a tremendous legacy that will extend and complement Aramark’s uniforms business,” says Eric J. Foss, Aramark’s chairman, president and CEO.
“This merger will enable us to enhance our customer service experience, unlock improved efficiencies, develop new career opportunities for employees and deliver value for our shareholders. Our companies share a commitment to world-class service, and I look forward to welcoming AmeriPride to the Aramark family.”
Aramark says it will acquire AmeriPride for a purchase price of $1.0 billion, or a net purchase price of $850 million after adjusting for the value of the anticipated tax benefits. AmeriPride operates in the United States and Canada with annual revenue of approximately $600 million.
The combination of these two uniform services companies will create a leading uniform services provider with enhanced scale and capabilities, serving nearly 500,000 customers, the company says. The transaction will bolster Aramark's competitive position in the United States, and immediately establish a strong position in Canada.
Additionally, Aramark anticipates annual cost synergies of approximately $70 million, which it expects will be fully realized by the fourth fiscal year after closing.
The board of directors of Aramark has unanimously approved the transaction, which was also unanimously approved by the board of directors of AmeriPride. The transaction is expected to close by the end of calendar year 2017, subject to customary closing conditions and regulatory approvals.
Aramark says it will finance the transaction through the issuance of new debt and has received fully committed financing.