Aramark May Go Private Again

On May 1, an investment group led by Chairman/CEO Joseph Neubauer offered $32 a share to take Aramark Corp. private in a deal valued at $5.77 billion. Besides Neubauer, the group includes private equity firms Thomas H. Lee Partners and Warburg Pincus LLC, as well as GS Capital Fartners and J.P. Morgan

A few weeks later, the company announced that it had hired Credit Suisse Securities LLC to help it evaluate the offer, as well as other available alternatives.

Analysts who follow Aramark say the $32 a share offer will almost certainly have to be raised if a bid is to be successful. Indeed, soon after the offer was announced, the company's stock price, which had been trading at around $28, rose above $34 before falling back but remaining above $32 as of FM press time in late May. This is a clear indication, analysts say, that investors expect competing offers, most likely from private equity firms, that would push the price up.