By Anirban Sen and Milana Vinn
(Reuters) – French workplace supplies provider Elis SA has approached Vestis, the former uniform rental business of Aramark, with a takeover offer, according to people familiar with the matter.
Elis first approached Vestis, which has a market value of about $3.3 billion including debt, a few weeks ago, said the people, who asked not to be identified because the talks are confidential. Terms of the offer could not immediately be obtained.
There is no certainty that Vestis will reach an agreement with Elis, the sources said. Another suitor could also approach Vestis and it is possible that no agreement will be reached with either party, the sources added.
Vestis shares rose nearly 15% following the news on Thursday, before trading was briefly halted.
Elis and Vestis did not immediately respond to requests for comment.
Vestis has emerged as a takeover target after its recent underperformance due to the loss of key clients led to a sharp fall in its share price. Its shares have lost around 35% of their value this year, lagging the Diversified Support Services Index, which has risen around 17% over the same period.
Vestis shares began trading last year after its tax-free spinoff of food services company Aramark was completed.
Activist investor Corvex Management, run by hedge fund veteran Keith Meister, took a stake in Vestis after it issued a profit warning following its first-quarter results. In June, Vestis appointed Meister to its board of directors.
Earlier this year, Vestis was the target of a class-action lawsuit by a shareholder who alleged the company made misleading statements about its growth outlook that resulted in a $1 billion valuation loss for shareholders.
Elis, which has a market value of about 9.2 billion euros ($10.2 billion) including debt, is a provider of workplace supplies and offers uniform maintenance services.
(1 dollar = 0.9024 euros)
!function(f,b,e,v,n,t,s){if(f.fbq)return;n=f.fbq=function(){n.callMethod? n.callMethod.apply(n,arguments):n.queue.push(arguments)};if(!f._fbq)f._fbq=n;n.push=n;n.loaded=!0;n.version=’2.0′;n.queue=();t=b.createElement(e);t.async=!0;t.src=v;s=b.getElementsByTagName(e)(0);s.parentNode.insertBefore(t,s)}(window, document,’script’,’https://connect.facebook.net/en_US/fbevents.js’);
