American food services company Aramark has acquired Avendra, a North American hospitality procurement services firm, for approximately $1.35bn.

Completion of the acquisition follows after the two companies entered into a definitive agreement in October this year.

Aramark expects cost synergies of nearly $40m from the purchase, which is expected to enhance purchasing capability and extends industry reach for both the parties.

Avendra, which is owned by Marriott International, Hyatt, Accor, ClubCorp and IHG, currently manages nearly $5bn in annual purchasing spend for more than 650 companies at over 8,500 locations, including over half of the Top 30 hotel chains.

Aramark chairman, president and CEO Eric J. Foss said: “By uniting the proven purchasing and supply chain management expertise of our two companies, we will create increased scale and improve service levels for our customers, strengthen our industry reach, provide new opportunities for our associates and drive sustained shareholder value.

“I welcome Avendra’s talented and experienced team to the Aramark family and look forward to the bright future we will build together.”

In addition, Marriott, Hyatt, Accor and ClubCorp have agreed to commit to a five-year procurement agreement with Aramark and Avendra.

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Headquartered in Maryland, Avendra will continue to operate under the existing brand name.

Goldman Sachs and Latham & Watkins served as financial adviser and legal counsel, respectively, to Avendra.