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March 9, 2020

US Foods to acquire Smart Foodservice Warehouse Stores for $970m

Foodservice distributor US Foods has signed a definitive agreement to acquire Smart Foodservice Warehouse Stores for $970m in cash.

Foodservice distributor US Foods has signed a definitive agreement to acquire Smart Foodservice Warehouse Stores for $970m in cash.

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According to the deal, US Foods will acquire Smart Foodservice from funds managed by affiliates of Apollo Global Management.

The transaction excludes the Smart & Final retail grocery business.

With the acquisition, US Foods seeks to establish its footprint in the cash and carry foodservice market.

US Foods chairman and CEO Pietro Satriano said: “As we continue to expand our multi-channel strategy, we know customers, particularly independent restaurants, increasingly use cash and carry as a convenient, cost-effective purchasing option.

“With an established footprint and a consistent record of profitable growth, Smart Foodservice will complement our CHEF’STORE cash and carry model and provide a platform to significantly accelerate our presence in this attractive, growing channel.”

The company will fund the transaction through its existing liquidity resources and $700m financing from Citigroup and Bank of America.

The transaction closing is subject to regulatory approval and other customary conditions.

Once complete, Smart Foodservice will operate as a separate unit within US Foods.

As a foodservice distributor, US Foods counts approximately 300,000 restaurants and foodservice operators as its partners.

In September 2019, the company secured the Federal Trade Commission (FTC) approval to acquire five operating companies of Services Group of America (SGA). The deal was valued at $1.8bn.

Based in Oregon, Smart Foodservice is a chain of warehouse-format stores, providing restaurant supplies.

The company operates 70 small-format cash and carry stores that serve small and mid-sized restaurants and other food industry clients.

Last year, Smart Foodservice reported total revenue of approximately $1.1bn.

Free Report
img

The critical role of sustainability for Foodservice success in the 2020s

Consumers have radically re-thought their priorities in recent years and changed their habits for the good of the planet, starting to hold companies accountable for their ESG activities. These changes are set to be significant hallmarks of the Consumer Landscape in the 2020s. In order to appease consumers’ new concerns, meeting these new sustainability imperatives will be crucial for the recovery of the Foodservice industry. Consumers are expected to use ESG criteria much more actively in their selection of Foodservice brands to engage with. Download GlobalData’s free report to:
  • Understand the range of ESG challenges currently facing the Foodservice sector
  • Gain insight into consumers’ expectations via consumer survey deep dives
  • Learn from foodservice operators and brands who are already successfully embracing ESG strategies
Stay ahead of consumer concerns and rise to meet them. Download the report now.
by GlobalData
Enter your details here to receive your free Report.

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