UniFirst Plunges 13% on Report the FTC Will Sue to Block Its $5.5B Sale to Cintas
UniFirst shares plunged 13.2% after a report that the FTC has told both companies it intends to sue to block Cintas' $5.5 billion takeover, pushing the gap between UniFirst's price and the $310-per-share deal value to $77 from $50 a day earlier.
UniFirst (UNF) shares plunged 13.2% on Tuesday after a report that the Federal Trade Commission has told UniFirst and Cintas (CTAS) it intends to file a lawsuit to block Cintas' $5.5 billion acquisition of the uniform maker. The reported decision has not been confirmed by the FTC or the companies. The gap between UniFirst's share price and the $310-per-share deal value widened to $77 from $50 on Monday, a sign that investors see a higher chance the deal will not close.
The deal
| Term | Detail |
|---|---|
| Announced | March 10, 2026 |
| Consideration | $155.00 in cash plus 0.7720 Cintas shares per UniFirst share |
| Value | $310 per share at Cintas' March 9 close of $200.77, or about $5.5 billion including debt |
| Synergies | About $375 million in operating cost savings within four years |
| Financing | Cash on hand, committed credit lines and fully committed bridge financing |
| Expected close | Before the end of calendar 2026, according to Cintas |
Because 0.7720 Cintas shares is part of the payment, the deal's value rises and falls with Cintas' stock price, so the $310 figure is a reference point rather than a fixed price. By our calculation, a $77 gap to $310 is about 25% of the headline value, compared with about 16% on Monday.
Where the reviews stand
| Date | Event |
|---|---|
| June 11 | FTC issued a second request for information to both companies |
| July 2 | Canada's Competition Bureau issued a supplementary information request |
| Sept. 29 | Both companies certified they had completed their Canadian response |
| Oct. 2 | Both companies certified substantial compliance with the FTC's second request and agreed not to close before Dec. 11, unless the FTC first says it has closed its investigation |
| Oct. 27 | Report that the FTC intends to sue to block the deal |
A timing agreement like the one the companies signed gives the FTC time to decide whether to challenge a deal before it can close. By our calculation, the Dec. 11 date is about six weeks away. If the FTC files a lawsuit, the companies would have to defend the merger in court, which could delay or end the transaction.
What could happen next
Cintas and UniFirst could fight the lawsuit, negotiate changes such as selling off parts of the business to address the FTC's concerns, or abandon the deal. Neither company has said what it would do. UniFirst's fall shows investors are pricing a meaningful chance that the transaction fails, while the Cintas share component of the payment also moves with Cintas' own stock.
What it means for investors
For UniFirst holders, the deal is the main support for the stock, so a blocked merger would leave it trading on its own business. For Cintas, a failed deal would avoid new borrowing and share issuance but forfeit the expected $375 million of savings. Merger arbitrage investors are now weighing a court fight whose outcome is hard to predict.
Sources: Cintas Corporation and UniFirst Corporation, merger announcement (March 10) and Cintas Form 8-K regarding regulatory review (Oct. 2 and Oct. 6). The FTC lawsuit plan is a report that neither company has confirmed. This is informational, not a recommendation to buy or sell.
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