Sysco buys US Foods for $3.5 billion
By Canadian Packaging Staff
General acquisition SYSCO United Natural Foods Inc. US FoosCash and stock buys $3.5 billion of food for Sysco Corp.
On December 9, 2013, Sysco Corp. of Houston, agreed to purchase the Rosemont, Ill-based US Foods in a cash and stick deal valued at about $3.5 billion.
The deal includes Sysco assuming US Foods $4.7 billion debt, but that’s no deal breaker, as the new Sysco says it should save around $600 million once it eliminates redundancies over the next few years, but is actually more excited because as a larger giant, it is expected to boost Sysco’s annual revenue to $65-billion, a jump of 46 per cent.
One year ago, Sysco completed the purchase of four independent foodservice companies with combined annual revenues of about $520 million. Sysco counts Wendy’s Co. as it’s largest customer
The US Foods deal is expected to close by the third quarter of 2014, pending regulatory and other approvals.
The the next largest publicly listed food distributor United Natural Foods Inc., an independent national distributor of natural and organic foods, specialty foods, and related products in the United States, distributing from eighteen centers throughout the U.S. and Canada.
For perspective, as of November 2, 2013 – the company’s Q1 2014 – it had net sales of $1.6-billion…. for the quarter… which is quite a bit less than what Sysco assumes it will pull in.
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