HOUSTON, TX - Sysco has made another offer in an attempt to close the deal on its merger with US Foods, according to Reuters. The company has now proposed to sell 11 distribution centers, currently run by US Foods, Inc., in order to attain approval from the Federal Trade Commission (FTC).
“Unfortunately, the FTC has taken a different view of the potential competitive impacts of the merger,” Bill DeLaney, Sysco Chief Executive, said in a news release according to the Wall Street Journal.
The centers would be sold to Performance Food Group, currently owned by an investment firm by the name of Blackstone Group LP, and generated $4.6 billion in revenue for the most recent fiscal year, according to Sysco. This more than doubles Sysco’s most recent offer of selling only $2 billion in annual revenue.
According to a press release, the distribution centers are located in: Corona, Calif.; Denver, Col.; Kansas City, Kan.; Phoenix, Ariz.; Salt Lake City, Utah; San Diego, Calif.; San Francisco, Calif.; Seattle, Wash.; Cleveland, Ohio; Las Vegas, Nev.; and Minneapolis, Minn.
“While we respectfully but vigorously disagree with the FTC’s analysis, we believe this divestiture package fully addresses its concerns,” DeLaney said.
"The collection of distribution centers and other assets that Performance Food Group will acquire along with related support services agreements will enable us to compete effectively for national broadline foodservice customers," said George Holm, Performance Food Group Chief Executive Officer and President. "We are excited by the opportunities for growth presented by this transaction and are confident that we will effectively execute our plans to become one of the country's premier broadline distributors serving customers coast to coast."
As we have previously reported, the merger has been delayed more than once since the official offer made in December of 2013. The only two companies with the current ability to offer delivery contracts nationwide to large consumer companies such as hospitals and hotels, the merger would combine the country’s two largest food distributors.
Stay tuned to AndNowUKnow to see if this offer wins the green light from the FTC.
