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NEW YORK - Engine Capital LP, a top five independent shareholder of UniFirst Corporation (NYSE:UNF) with approximately 3.2% ownership, has publicly called for the company to pursue a sale after failed attempts at private engagement with company trustees.
In an open letter released Tuesday to trustees Carol Croatti, Matthew Croatti, Cynthia Croatti, and Cecelia Levenstein, Engine Capital Managing Member Arnaud Ajdler criticized the board’s governance practices and performance since the passing of former CEO Ron Croatti over eight years ago.
The activist investor highlighted that UniFirst’s stock price has remained "essentially flat" during this period while competitor Cintas Corporation’s shares have increased nearly five-fold. Engine Capital claims the company rejected a premium offer from Cintas earlier this year.
"Shareholders, Wall Street analysts, and we suspect your own management team and directors understand that UniFirst has no realistic standalone path to achieve the valuation a strategic buyer could pay today," Ajdler wrote in the letter.
The investor also criticized the board for scheduling a virtual-only annual meeting for December 15, which it described as "materially earlier than the Company’s historical cadence" and designed to "favor and protect the trustees at the expense of shareholders."
Engine Capital has nominated two director candidates, including Michael Croatti, who is related to the trustees, and suggested a third candidate with "deep governance and capital allocation experience."
The firm argues a sale would benefit all stakeholders including employees, customers, and shareholders, while ending what it describes as "internal divisions and infighting" within the Croatti family.
According to the press release statement, Engine Capital has filed a preliminary proxy statement with the SEC to solicit votes for its director nominees at the upcoming annual meeting.
In other recent news, Quest Diagnostics reported its third-quarter 2025 earnings, surpassing expectations with an adjusted earnings per share (EPS) of $2.60, compared to the forecasted $2.50. The company’s revenue also exceeded predictions, reaching $2.82 billion against the expected $2.73 billion. Following these results, Quest Diagnostics raised its fiscal year 2025 guidance. Additionally, Truist Securities increased its price target for Quest Diagnostics to $205 from $195, maintaining a Hold rating, while Leerink Partners raised its target to $210 from $203, keeping an Outperform rating. Both firms cited the company’s strong third-quarter performance as a reason for their adjustments. In other developments, Quest Diagnostics declared a quarterly cash dividend of $0.80 per share, payable on January 28, 2026. Meanwhile, Hims & Hers Health has partnered with Quest Diagnostics to expand into lab testing services, allowing customers access to testing at over 1,000 locations nationwide. These recent developments highlight Quest Diagnostics’ continued growth and strategic partnerships in the healthcare sector.
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