Investment firm Mantle Ridge LP on Friday said it had accumulated a 9.8% stake in Aramark Corp. and intends to agitate for changes at the at Philadelphia food- and business-services giant. Aramark’s shares were up 6%, or $2.25, to $39.35 in after-hours trading.
In its Securities and Exchange Commission filing, Mantle Ridge, owned by Paul C. Hilal, said it planned to have “conversations, meetings, and other communications" with members of Aramark’s board, management team, and other stockholders "to discuss the issuer’s business, operations, strategies, governance, the composition of the executive suite and board, and possibilities for changes.”
In March, two Wall Street analysts at Nomura-Instanet called for an activist investor to push out Aramark’s current leadership, which has focused on improving profit margins but has failed to generate enough revenue growth to satisfy some investors.
Aramark said in a statement that it was “focused on maximizing long-term value for all of our shareholders, and welcomes open communication and constructive dialogue with our shareholders toward that goal.”
Hilal is a former senior partner at Pershing Square Capital Management, where he participated in activist investments in Ceridian, a data processing company, and Air Products & Chemicals Inc., according to a biography on his firm’s website.
Aramark’s shares remain below their 52-week high of $42.97 reached last September, but have recovered from a low of $27.99 in December. They closed Friday at $37.10 during official trading hours.
Early this year, Aramark was embroiled in controversy over a decision by the company not to pay bonuses to thousands of front-line managers.