Oct 27 (Reuters) - The Federal Trade Commission has indicated to uniform rental firm Cintas that it will sue to block its proposed $5.5 billion acquisition of rival UniFirst, 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.
Here are more details:
• In March, Cintas, valued at $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 $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
(Reporting by Koyena Das in Bengaluru; Editing by Maju Samuel)