Sysco Corp said it would purchase rival US Foods Inc for about $3.5 billion and assume about $4.7 billion in debt to cement its position as the biggest U.S. food distributor, driving up Sysco's shares 30 percent before the bell.Shareholders of US Foods, owned by affiliates of private equity firms Clayton, Dubilier & Rice and KKR & Co, will own about 13 percent of Sysco after the closing of the deal, which will create a company with revenue of $65 billion."Combining and maximizing the significant strengths of two outstanding companies is certain to be of tremendous advantage in supporting our customers," US Foods Chief Executive John Lederer said in a statement on Monday.Sysco and US Foods distribute foods to restaurants, hotels, hospitals, schools and other institutions.
Sysco Corporation (Sysco), along with its subsidiaries and divisions, is a North American distributor of food and related products primarily to the foodservice or food-away-from-home industry. Shares of SYY remained unchanged at $34.31. In the past year, the shares have traded as low as $30.55 and as high as $36.05. On average, 3723800 shares of SYY exchange hands on a given day and today's volume is recorded at 1018759.
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