Food services company Aramark has announced that it will be buying hospitality procurement services provider Avendra for $1.35bn, and linen and uniform company AmeriPride for $1bn.
Aramark cites that Avendra will be acquired to enhance purchasing capability and extend industry reach, whilst AmeriPride is being bought to expand the scope and geography of its uniforms business. Both acquisitions will see the company grow its food, facilities and uniform portfolio.
"Today is an historic day at Aramark as we announce we will join forces with two leading companies that will significantly improve how we service our customers, while expanding our capabilities and scope in critical areas of our business," said Eric Foss, Aramark's Chairman, President and CEO.
“We have been executing successfully against our clear and focused strategy and have substantially elevated our operating performance and financial flexibility. These strategic and financially compelling transactions represent the next step in our commitment to drive sustainable shareholder value."
Avendra, currently owned by Marriott International, is a leading hospitality firm, managing $5bn in annual purchasing for over 650 companies, including half of the leading 30 hotel chains.
"I am excited about the proven talents and deep experience the Avendra team brings to our company and look forward to welcoming them to the Aramark family,” Foss said.
AmeriPride will also bring great value to Aramark’s portfolio, one that will serve half a million customers in the uniforms industry following the successful acquisition.
"This merger will enable us to enhance our customer service experience, unlock improved efficiencies, develop new career opportunities for employees and deliver value for our shareholders,” Foss continued.
In addition to the double acquisition costing a total $2.35bn, Aramark expects to incur synergy costs totalling approximately $40mn for Avendra, and $70mn for AmeriPride.