US Foods acquisition of Smart Foodservice : US Foods has agreed to acquire Smart Foodservice Warehouse Stores, an Oregon-based warehouse grocery store chain from funds managed by affiliates of Apollo Global Management for $970 million in an all-cash deal as per the latest retail acquisition news.
The US foodservice distributor believes that the acquisition will accelerate its growth with independent restaurant customers via expansion of its cash and carry channel.
Smart Foodservice Warehouse Stores has 70 small-format cash and carry stores in California, Oregon, Idaho, Washington, Nevada, Montana, and Utah that cater to small and mid-sized restaurants and other food business customers with a broad range of products.
Established in 1955, the Portland-based warehouse grocery store chain employs nearly 900 associates.
Smart Foodservice Warehouse Stores 2019 revenue was about $1.1 billion.
Commenting on US Foods acquisition of Smart Foodservice, Pietro Satriano – US Foods chairman and CEO 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 deal excludes the retail grocery business of Smart Foodservice Warehouse Stores, which was separated from it before the signing of the current deal.
Following the completion of the deal, the low price warehouse grocery store chain will be run as a separate operating unit within US Foods, with minimal integration needed. Owing to this, the deal is not likely to have any material effect on the ongoing integration of the Food Group business, which continues to remain on track.
Derek Jones – President of Smart Foodservice, commenting on US Foods acquisition of Smart Foodservice, said: “The management team at Smart Foodservice very much looks forward to working with the team at US Foods in accelerating our growth in the attractive cash and carry foodservice market. US Foods is an ideal partner for Smart Foodservice and we are excited about the synergistic and strategic benefits of the combination.”
The deal is subject to receipt of regulatory approval and other closing conditions.