River Road Asset Management Addresses UniFirst Board Regarding Shareholder Concerns

Core Viewpoint - River Road Asset Management expresses significant disappointment with UniFirst's Board and management for rejecting a proposed acquisition by Cintas, which was seen as a breach of fiduciary duty and detrimental to shareholder interests [2][6]. Company Performance - UniFirst's financial performance peaked in FY19, but the company has since struggled with labor and benefits inflation, merchandise cost pressure, and limited pricing power to offset these challenges [3][6]. - Under CEO Steve Sintros, UniFirst has lagged behind Cintas in key operational metrics, leading to a widening valuation gap between the two companies [4][6]. Strategic Alternatives - River Road advocates for the exploration of strategic alternatives, including a potential sale of UniFirst, to maximize shareholder value and mitigate execution risks associated with the current operational strategy [7]. Market Context - The competitive landscape in the laundry industry emphasizes the importance of scale, with route density providing advantages in margins and service levels [3]. - The rejection of the Cintas offer has led to a decline in UniFirst's stock price, which has fallen below pre-offer levels, reflecting ongoing operational challenges and a lack of confidence in future growth [6].