US Foods to acquire SGA’s Food Group of Companies

July 31, 2018
Learn about US Foods agreeing to acquire five operating entities collectively known as SGA’s Food Group of Companies.

US Foods Holding Corporation and Services Group of America have entered into a definitive agreement under which US Foods will acquire five operating companies collectively known as SGA’s Food Group of Companies, for $1.8 billion in cash. The transaction has been unanimously approved by US Foods’ board of directors.

Scottsdale AZ-based SGA’s Food Group of Companies has combined 2017 net sales of $3.2 billion and about 3,400 employees. It currently operates as these five separate operating companies:

•Food Services of America Inc (FSA)—One of the largest regional broadline distribution companies in the United States serving 16 states in the West and Midwest from nine distribution centers; 75% of net sales.

•Systems Services of America Inc (SSA)—Multi-unit distribution foodservice company specializing in distribution to casual and fast casual dining establishments and regional and national QSR chains; 21% of net sales.

•Amerifresh Inc—Strong produce sourcing and marketing capabilities, 2% of net sales.

•Ameristar Meats Inc—Provider of custom meat products, including 18 different beef programs to meet customer specifications; 1% of net sales.

•GAMPAC Express Inc—Supply chain planning and logistics; 1% of net sales.

US Foods will finance the acquisition primarily with $1.5 billion in fully committed term loan financing from J P Morgan and Bank of America Merrill Lynch and will fund the balance of the purchase price through its liquidity resources. At the closing of the acquisition, US Foods’ pro forma net leverage is expected to be 4.1x. Given the combined company’s strong cash flow generation, including synergies, US Foods expects to reduce net leverage to approximately 3.0x by the end of fiscal 2020.

The acquisition is subject to regulatory approval and other customary closing conditions.

Visit to learn more.

Voice your opinion!

To join the conversation, and become an exclusive member of FleetOwner, create an account today!

Sponsored Recommendations

Leveraging telematics to get the most from insurance

Fleet owners are quickly adopting telematics as part of their risk mitigation strategy. Here’s why.

Reliable EV Charging Solution for Last-Mile Delivery Fleets

Selecting the right EV charging infrastructure and the right partner to best solve your needs are critical. Learn which solution PepsiCo is choosing to power their fleet and help...

Overcoming Common Roadblocks Associated with Fleet Electrification at Scale

Fleets in the United States, are increasingly transitioning from internal combustion engine vehicles to electric vehicles. While this shift presents challenges, there are strategies...

Report: The 2024 State of Heavy-Duty Repair

From capitalizing on the latest revenue trends to implementing strategic financial planning—this report serves as a roadmap for navigating the challenges and opportunities of ...