FTC to sue to block Cintas-UniFirst deal, Semafor reports

The Federal Trade Commission has indicated to uniform rental firm Cintas CTAS.O that it will sue to block its proposed US$5.5 billion acquisition of rival UniFirst UNF.N, Semafor reported on Tuesday, citing people familiar with the matter.

The FTC has not yet voted on whether to sue, but its staff have privately expressed concerns about the companies' combined market share, the report added.

In March, Cintas, valued at US$89.71 billion,agreed to buy smaller rival UniFirst in a cash-and-stock deal, combining two of North America's largest workwear and facility services providers. UniFirst has a market cap of US$5.06 billion.

The deal capped a multi-year pursuit in which Cintas had made at least three formal approaches since 2022.

Cintas was banking on the deal to expand its reach and cut costs by combining delivery routes, plants, and supply chains, as it looked to better compete with rivals.

Shares of UniFirst fell 8% on Tuesday, while Cintas was down about 5%.

Cintas, UniFirst and the FTC did not immediately respond to Reuters' requests for comment.

AFP

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