On January 7, 2025, Cintas Corp. announced a $5.3 Billion offer to purchase rival UniFirst. Both companies’ core business is corporate uniforms. Cintas is headquartered in Mason, OH, over 20 miles north of Cincinnati. UniFirst is in Wilmington, Massachusetts.
This proposed acquisition has an interesting history. Cintas proposed acquiring UniFirst in February 2022, but the offer was rejected. Management has now rejected this second offer.
Steve Watkins of the Cincinnati Business Courier quotes Cintas CEO Todd Schneider saying:
“We call on the UniFirst board, its controlling shareholders and management team to immediately engage with us to reach a mutually acceptable definitive agreement that delivers the full value of this combination for shareholders and other stakeholders…We firmly believe in the compelling strategic fit between our two companies, and our offer would deliver immediate and compelling value to UniFirst shareholders…The combination would also amplify the benefits of Cintas and UniFirst’s ongoing technology investments to drive growth and benefit our collective customers and employee-partners.”
UniFirst issued a response, saying:
“The board conducted a careful review of the unsolicited proposal and determined that it is not in the best interests of UniFirst, its shareholders and other stakeholders,” adding the decision was made based on the offer price, business risks and feedback from its largest shareholders.
Cintas
Cintas is 3½ times larger, with $9.6 Billion in revenue, versus $2.7 Billion for UniFirst. UniFirst has an interesting strategy, though, to fight back.
UniFirst posts on its website suggestions directed at customers of companies acquired by Cintas to consider switching to them. And there is more than one company listed. How about that!
Cintas is not a bad company. Watkins published an article in 2024 that highlights its positive work culture.
Analysis
Cintas’s approach to acquiring UniFirst is a classic example of what’s wrong with mergers and acquisitions today. It is a business chess game where the opponent is forced to play.
If someone came out of the blue to tell you what is in your best interest, would you like that? Is this a way to win friends and influence people? I know that many people preach about the benefit of “persistence”, but in this case “persistence” is really bullying, isn’t it?
If a company’s management is actively pursuing an acquirer, do their homework and find “the right fit”, that’s one thing. A merger may be a better option than an acquisition, though. In this case bullying tactics are used where the only real question the acquirer asks is “what’s in it for me?”
Cintas’ approach to its employees is totally different to its acquisition process, isn’t it? It is like they act as a Jekyll and Hyde company. Do you believe companies should engage in bullying tactics with their competition? Is this how you operate? Does the end justify the means here?