Aramark files for IPO, hopes to raise $600 million

Thursday, July 19, 2001 | 11:10 a.m.

SUN STAFF AND WIRE REPORTS

Philadelphia-based Aramark Corp., which provides food, child-care and laundry services worldwide, filed for an initial public offering of new class B shares that could raise as much as $600 million.

The company, which has a large presence in Las Vegas as a concessionaire for Cashman Field and as the contracted food service provider at the Las Vegas Convention Center, didn't say how many shares would be offered, but said the total would be less than 20 percent of its outstanding shares, which would leave insiders in control of the company.

Aramark hopes to list the new shares on the New York Stock Exchange.

Aramark, which employs about 6,000 workers in Philadelphia and 185,000 worldwide, reported sales of $7.3 billion and net income of $168 million in fiscal year 2000.

Aramark didn't set a price range for the shares in the IPO. The company valued the stock sale at $600 million to calculate its Securities and Exchange Commission registration fee.

The company hired Goldman, Sachs & Co.; J.P. Morgan Securities Inc. and Morgan Stanley Dean Witter & Co. to underwrite the stock sale. Aramark plans to list the its shares on the New York Stock Exchange under the symbol RMK.

"The offering is intended to put in place a capital structure that will give Aramark greater financial flexibility to respond to changes in worldwide market conditions with a publicly traded equity security that can be used, when appropriate, for strategic initiatives," said an Aramark statement filed with the SEC.

"At the same time, the company intends to preserve the best aspects of its employee-owned and owner-managed culture while providing some liquidity to current stockholders," the statement said.

The company, citing SEC "quiet period" rules governing initial public offerings, said it could not comment on what impact the move would have on operations in Las Vegas.

The company said more detailed information about its proposals would be listed in future SEC filings.