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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
Current Report Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)........ April 25, 1998
G&K SERVICES, INC.
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(Exact name of registrant as specified in its charter)
MINNESOTA 0-4063 41-0449530
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(State or other jurisdiction (Commission File Number) (I.R.S. Employer
of incorporation) Identification Number)
5995 Opus Parkway, Suite 500
Minnetonka, MN 55343
(Address of principal executive offices)
Registrant's telephone number, including area code ....... (612) 912-5500
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(Former name or former address, if changed since last report)
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ITEM 5. OTHER EVENTS.
The Registrant's Press Release dated April 27, 1998, which is filed as
Exhibit 99.1 to this Form 8-K, is incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENT, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(c) EXHIBITS. The following documents are filed as an exhibit to this
Form 8-K and is incorporated herein by reference:
99.1 Press Release dated April 27, 1998.
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Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Dated: April 29, 1998 G&K SERVICES, INC.
By /s/ Timothy W. Kuck
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Timothy W. Kuck
Its Chief Financial Officer
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EXHIBIT INDEX
Page
Exhibit No. Description Number
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99.1 Press Release
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Exhibit 99.1
MINNEAPOLIS, April 27 /PRNewswire/ -- G&K Services, Inc. (Nasdaq: GKSRA)
announced today it has signed an agreement to sell 10 processing facilities
and related branches to Tartan Textile Services, an affiliate of Aurora
Capital Partners. The transaction includes seven of the nine linen rental
plants acquired by G&K from National Linen Services (NLS), a division of
National Service Industries, in July 1997. Another of the linen plants was
sold separately last January. The Company announced its intention to divest
the linen operations acquired from NLS at the time of the acquisition. The
sale also includes three of the 20 uniform rental facilities acquired from
NLS.
The Company expects to realize approximately $81 million from the
transaction, which includes $75 million for the operating assets to be
acquired by Tartan and $6 million from the liquidation of working capital used
in the businesses being sold. The Company earlier received $2.6 million from
the facility sold separately in January.
The transaction, which is subject to customary post-closing adjustments,
is expected to be completed shortly. Proceeds from the sale will be used to
reduce the Company's $333 million outstanding debt. The transaction has been
approved by the boards of directors of both companies, and is subject to the
satisfaction of various closing conditions.
The transaction with Tartan Textile Services will complete the sale of
eight of the nine linen facilities acquired from NLS. G&K is continuing to
market the remaining linen facility. "After nine months of negotiations with
various interested parties, we were able to sell these facilities to a single
buyer who intends to continue the operation of these businesses," said Richard
Fink, chairman of G&K Services. "The purchase price for these assets is
consistent with the values we assigned to them, and we have been able to
accomplish this sale within our projected time frame."
In addition to seven linen facilities, three uniform rental plants are
part of the Tartan Textile Services transaction. "In evaluating our business
opportunities, we determined that three NLS uniform rental plants located in
western Texas and West Virginia serve markets which are not consistent with
our current strategic needs," said Fink.
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"We are very pleased with this transaction," he added. "It will help us
focus our efforts more intensively on the development of the remaining uniform
plants we acquired, as well as to achieve a substantial reduction in our debt
level."
Statements in this press release which are not strictly historical are
"forward-looking" statements that are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995. Forward-
looking statements involve known and unknown risks, which may cause the
company's actual results in the future to differ materially from expected
results. The statements regarding the sale of assets reflect management's
best judgment at the time of issuance, but readers are reminded that not all
expectations will, in fact, come to pass, and that all such statements are
qualified in their entirety by cautionary statements contained in the most
current SEC Form 10-Q.
G&K Services is one of North America's largest suppliers of corporate
uniform programs. The Company provides services in the United States and
Canada from over 125 locations.
/CONTACT: Richard M. Fink, Chairman, 612-912-5500, or Timothy W. Kuck,
CFO, 612-912-5500, both of G&K Services; or Michael Rosenbaum or Leslie
Hunziker, General Info, or Suzy Lynde, Analysts, 312-266-7800, all of the
Financial Relations Board/
