Aramark has signed a definitive merger agreement under which a group led by Chairman/CEO Joseph Neubauer will acquire the company in a transaction valued at approximately $8.3 billion (including the assumption of approximately $2 billion in debt). The deal was unanimously approved by Aramark's board of directors but is contingent on the approval of its stockholders, as well as the appropriate regulatory bodies.
Under the terms of the agreement, Aramark stockholders will receive $33.80 in cash for each share of common stock they hold. That is a 20 percent premium over the price of Aramark's stock the day before the original $32-per-share buyout offer was announced.
Neubauer owns 40 percent of Aramark's Class A shares and 17 percent of the Class B shares, according to a recent SEC filing. The Class A shares, which are not publicly traded, have 10 times the voting power of Class B shares.
However, Neubauer has agreed to cast only one vote for each of the Class A shares he holds in the stockholder vote ratifying the buyout. As a result, his vote could represent less than five percent of the total.
Estimates put the value of Neubauer's shares of the public company as being worth close to $800 million; he will reportedly contribute up to $250 million toward the buyout. The balance will come from investment funds managed by GS Capital Partners, CCMP Capital Advisors and J.P. Morgan Partners, Thomas H. Lee Partners and Warburg Pincus LLC. The transaction is expected to be completed by late 2006 or early 2007, according to the company.
In other announcements, Aramark named Dennis Maple president of Armark Education, its K-12 division. Maple will report directly to Andrew Kerin, president of Aramark Domestic Food, Hospitality and Facilities.
Meanwhile, Richard Wyckoff, president of the company's Refreshment Services and Business & Industry—Facility Services division, has resigned (no successor had been named at FM press time.)