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Sysco Buying US Foods for Approximately 8.2 Billion Dollars

Sysco Buying US Foods for Approximately 8.2 Billion Dollars


HOUSTON, TX

Sysco Corporation and US Foods announced an agreement to merge, creating a world-class foodservice company. The total enterprise value of the transaction is approximately $8.2 billion. Sysco will pay an estimated $3.5 billion for the equity of US Foods which comprises $3 billion of Sysco common stock and $500 million of cash and will assume or refinance US Foods' net debt, which is currently approximately $4.7 billion, according to a press release.

This transaction will bring together Sysco and US Foods' complementary strengths including US Foods talented and dedicated associates who have made the company's acquisition such a strategic play in the marketplace.

This evolution of US Foods has much to do with John Lederer who was appointed President and Chief Executive Officer, US Foods in September 2010 and brought with him the ingenuity of Pietro Satriano, Chief Merchandising Officer of US Foods.

With this team, US Foods has executed the introduction of innovative new products and concepts that include Keeping Kitchens Cooking, offering items that help shape the communities where people live and work. The company's recent venture Food Fanatics magazine has also helped foodservice differentiate their products and menus to expand the industry's perception of the possibilities of food.

Previously, Lederer was Chairman and Chief Executive Officer of Duane Reade where he led a major transformation of the company to create one of the best urban drugstore formats in America, which ultimately culminated in the strategic sale of the company to Walgreens. Lederer also enjoyed a highly successful 30-year-career at Loblaw Companies where he served in a variety of senior leadership positions including President from 2000 to 2006. Lederer was responsible for the successful pursuit of its strategic, operational and financial objectives.

John Lederer, stated, "Combining and maximizing the significant strengths of two outstanding companies is certain to be of tremendous advantage in supporting our customers as they tackle the challenges of today's demanding environment."

Bill DeLaney, Sysco President and CEO, will lead the combined company, which will continue to be named Sysco. At closing, Sysco will have estimated annual sales of approximately $65 billion.

According to Deal Book, The deal will also give US Foods’ owners a path to exit this investment. Clayton Dubilier and K.K.R. bought US Foods from Royal Ahold in 2007 for about $7.1 billion including debt.

Bill DeLaney, Sysco president and chief executive officer, said, "As we continue on our transformational journey at Sysco, this transaction will position us to significantly accelerate our progress in achieving the vision we have for our company: to be our customers' most valued and trusted business partner. Sysco and US Foods have highly complementary core strengths including a broad product portfolio and passionate food, people deeply committed to customer service, quality-assured products and safety. In particular we look forward to welcoming US Foods' talented employees and continuing to invest in the development of all of our people. Together we will strive to enhance shareholder value by providing our customers with highly differentiated products and services."

Sysco

US Foods

Deal Book

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