Sysco counters merger review rumors
HOUSTON – Sysco Corp. said the company's merger with US Foods is on track, refuting rumors that the deal was facing trouble with a Federal Trade Commission (FTC) review. Sysco provided the update following what the company called misleading reports about the status of the FTC's review of the Sysco-US Foods merger.
"In light of this recent misleading report, it's important to convey that Sysco continues to cooperate closely with the Federal Trade Commission in its review of the proposed merger of Sysco and US Foods," said Bill DeLaney, president and CEO of Sysco. "We are engaged in a productive dialogue with the FTC, and the review is proceeding as expected. We continue to believe that the commission, once it finishes its investigation, will conclude that our industry is – and will continue to be – fiercely competitive. Our proposed merger will benefit customers and help us become more efficient in this rapidly evolving marketplace."
The total value of the transaction is $8.2 billion. The combined companies are expected to have annual sales of approximately $65 billion and generate operating cash flows of approximately $2 billion, according to Sysco. The two food-distribution companies also would have a combined market share of roughly 25 percent.
The deal has raised objections. Earlier in June, the Teamsters Union warned that the merger could limit competition and hurt consumers, food suppliers, small businesses and government agencies.