Rosemont, Illinois, U.S.A.-based US Foods is reportedly considering acquiring Performance Food Group (PFG).
If the rumored merger, reported by Bloomberg on 11 July, were to go through, it would create the largest broadline distributor in the U.S.
Richmond, Virginia, U.S.A.-based PFG is the second-largest foodservice distributor in the country and generated USD 60 billion (EUR 51 billion) in sales in 2024, according to Technomic data cited by Restaurant Business. US Foods generated USD 37.9 billion (EUR 32.5 billion) in sales in the same period.
Houston, Texas, U.S.A.-based Sysco is currently the largest broadline distributor in the nation, accruing USD 64.6 billion (EUR 55.4 billion) in total sales last year, but rumors of a merger represent a challenge to the firm’s dominance in the space, the Food Institute reported.
Sysco will report its fourth-quarter and full-year earnings for its 2025 fiscal year on 29 July, but it posted a 2 percent decline in U.S. case volume for its fiscal third quarter. Globally, Sysco’s sales value increased 1.1 percent in the three-month period, but net earnings dropped 5.6 percent year over year to USD 401 million (EUR 344 million).
“Sysco seems to be losing share in the independent channel, which makes the timing of this deal even more sensible: creating one giant at the same time another is struggling,” the Food Institute said.
If US Foods officially pursues the merger, however, it could face the same federal scrutiny that similar deals have encountered in the past. In 2015, Sysco canceled a planned merger with US Foods after the Federal Trade Commission blocked the merger, Restaurant Business said.
“The FTC alleged that if the merger goes forward as proposed, foodservice customers, including restaurants, hospitals, hotels, and schools, would likely face higher prices and lower levels of service than would be the case but for the merger,” the FTC said at the time. “A combined Sysco/US Foods would account for 75 percent of the national market for broadline distribution services. In addition, the parties would also hold high shares in a number of local markets.”
Nevertheless, US Foods has made moves recently readying itself for further growth. The firm broke ground in June on an expansion of its facility in Buda, Texas, that will add 170,000 square feet to the 290,000-square-foot facility.
“The increased capacity will enhance food distribution along the I-35 corridor, especially to Austin’s world-class food scene,” Texas Senator Judith Zaffirini said regarding the expansion. “This project highlights our tradition of private-public collaboration that spurs tremendous regional growth.”
Even before the distributor was rumored to be mulling a merger with PFG, US Foods executives said in February the company was seeking acquisitions of smaller distributors. The distributor had more than 100 targets with a total revenue of USD 15 billion (EUR 12.9 billion) in its acquisition pipeline, they said at the time.
