Sysco, US Foods To Merge - Quick Facts

(RTTNews) - Sysco Corp. (SYY) and US Foods announced an agreement to merge. Sysco will pay approximately $3.5 billion for the equity of US Foods, comprising $3 billion of Sysco common stock and $500 million of cash. The total enterprise value of the transaction is approximately $8.2 billion. Sysco will also assume or refinance US Foods' net debt, which is currently approximately $4.7 billion, bringing the total enterprise value to $8.2 billion. After completion of the transaction, the equity holders of US Foods will own approximately 87 million shares, or roughly 13% of Sysco.

Bill DeLaney, Sysco president and chief executive officer, will lead the combined company, which will continue to be named Sysco and headquartered in Houston, Texas.

At closing, the combined companies are expected to have annualized sales of approximately $65 billion and generate operating cash flows of approximately $2 billion. The transaction is expected to be immediately accretive to earnings after adjusting for transaction-related costs and amortization of intangibles.