Sysco shares fall as merger hits a snag
Sysco, US’s biggest food distributor to restaurants, is trying to save its $3.5 billion merger with its closest rival US Foods.
The company is in talks with the No. 3 distributor, Blackstone Group-owned Performance Food Group, about selling it certain assets so it can gain regulatory approval, a source with direct knowledge of the situation said.
Peformance Food Group could make it much harder for Sysco to complete its merger if it does not buy the assets, since the Federal Trade Commission likely sees it as the only viable buyer of assets it will force Sysco to divest, sources said.
Sysco on its Monday earnings call said the review of its merger announced last December with KKR and Clayton, Dubilier & Rice-owned US Foods was being delayed.
“We’re looking for a solution. We just think right at this point it’s going to take longer than we originally projected,” the company said.
The Post reported exclusively on Oct. 13 that Deborah Feinstein, the FTC’s head of competition, had told the FTC’s five commissioners she was ready to sue to block the deal unless certain conditions were met.
In December 2013, Sysco stated it would divest assets with $2 billion in revenue in order to get the deal past regulators.
Source: nypost- Sysco shares fall as merger hits a snag
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