Under terms of the agreement, Chefs' Warehouse agreed to pay:
• $123.9 million in cash, which was funded with the company's revolving credit line in addition to $25.0 million in additional senior secured notes to entities affiliated with The Prudential Insurance Company of America. The notes bear interest at 5.80 percent and come due in October 2020;
• 1.1 million shares of the company's common stock, which is valued at $22.00 per share; and
• $36.7 million in convertible subordinated notes issued to entities affiliated with Del Monte with a six-year maturity bearing interest at 2.50 percent with a conversion price of $29.70 per share.
Chefs' Warehouse also agreed to pay an additional 24.5 million upon the successful achievement of adjusted EBITDA targets for Del Monte's affiliates and other improvements in certain operating metrics for the Del Monte's protein business over the six years following the closing.
“We are extremely excited to complete this acquisition and welcome Del Monte's very experienced management team and a group of dedicated associates to the Chefs' Warehouse family,” said Chris Pappas, chairman and CEO of The Chefs' Warehouse. “The combination of Del Monte, Allen Brothers, and Michael's brings us closer to achieving our goal of being a national specialty protein supplier.”
John DeBenedetti, former president and CEO of Del Monte, was named executive vice president of protein and is expected to be appointed to the company's board of directors later this year.
The Chefs' Warehouse carries and distributes more than 30,000 foodservice products and supplies to more than 20,000 customer locations throughout the United States and Canada.