Sysco to Purchase Brakes Group in $3.1 Billion Deal
Sysco Corporation, North America’s leading food service distributor, has agreed to acquire Brakes Group, a leading European food service distributor with operations in the United Kingdom, Ireland, France, Sweden, Spain, Belgium and Luxembourg. Brakes Group is owned by Bain Capital Private Equity. The transaction is valued at approximately $3.1 billion (£2.2 billion) and includes the repayment of approximately $2.3 billion of Brakes Group’s financial debt.
The deal expands Sysco’s footprint in the UK and Ireland and further into Europe and positions the company for potential future expansion in these markets. The deal is subject to customary regulatory review by European Union competition authorities. The companies expect to complete the transaction before the end of Sysco’s fiscal year in July 2016.
Headquartered in London, Brakes Group will operate as a standalone company within Sysco. The Brakes Group business will continue to be led by chief executive officer Ken McMeikan. His management team and the rest of the employee base will remain in place.
Bill DeLaney, chief executive of Sysco Corporation.
Bill DeLaney, chief executive of Sysco, comments: “This transaction will unite Sysco with a leading foodservice distributor in Europe with demonstrated capability to sustainably grow its business over time. Beginning with a common customer-centric mindset, our companies are strategically aligned with compatible cultures and similar business models. We expect to retain key members of Brakes Group’s talented leadership team and to experience little distraction from integration given the minimal overlap of the businesses. Sysco’s management team remains confident in and committed to achieving our previously announced three-year plan financial objectives.”
“Since we bought Brakes Group in 2007, the business has been transformed with capital investment of more than 100 million British pounds in an e-commerce platform, multi-temperature distribution infrastructure, and customer service enhancements,” says Dwight Poler, managing director of Bain Capital Private Equity. “There is still a huge market opportunity ahead that I am confident Brakes Group is very well placed to deliver with Sysco.”
In 2015, Brakes Group’s increased revenue by 6.5% to $5 billion (£3.3 billion).
