A wholesale outlet store in Middletown Township is part of a $29.1 billion acquisition deal.
Advertisements
Sysco Corp., the global food service company, announced it will acquire Jetro Restaurant Depot in a transaction consisting of both cash and stock.
The deal brings together Restaurant Depot’s warehouse-style store on East Lincoln Highway, which opened in Middletown Township in 2013, into Sysco’s portfolio.
The acquisition is designed to bridge the gap between traditional food service delivery services and the “cash-and-carry” warehouse store model.
Advertisements
Restaurant Depot is a large supplier for nonprofits, small businesses, and independent restaurants.
The retailer has 166 large-format warehouses across 35 states.
Advertisements
According to company data, Restaurant Depot’s operations generate approximately $16 billion in annual revenue.
Sysco CEO Kevin Hourican said the merger will provide the distributor with direct access to Restaurant Depot’s customer base of 725,000 independent restaurant and food service operators.
“Together, Sysco and Jetro Restaurant Depot will enhance value for small independent restaurants and the consumers they serve by expanding access to more affordable, fresh food products and delivering more choice and convenience,” Hourican said in a statement.
Advertisements
The CEO stated that Sysco intends to leverage its logistics network to support Restaurant Depot while using the new platform to reach local customers in different ways.
Stanley Fleishman, executive chairman of Jetro Restaurant Depot, said the deal is a milestone for the company, which has spent 50 years building its business model.
Advertisements
“Today’s announcement is an exciting moment for Jetro Restaurant Depot and a clear recognition of the strength of our business model, and the teams who have built it,” Fleishman said.
The two companies saw combined net revenues of nearly $100 billion last year.
Advertisements
Sysco officials expect the integration to produce approximately $250 million in annual synergies within the first three years.
Sysco plans to use $1 billion in cash on hand and $21 billion in new debt to fund the deal.
Advertisements
Hourican said that the company does not plan to slow down and has intentions to continue opening new Restaurant Depot warehouses nationwide.
