US Foods purchases SGA’s Food Group of Companies

On July 30, US Foods Holding Corp announced they had entered into a definitive agreement with Services Group of America (SGA) to acquire five operating companies collectively known as SGA’s Food Group of Companies, for $1.8 billion in cash. The company has had a disappointing second quarter.

“This acquisition will significantly increase US Foods’ reach across key markets in the attractive and growing Northwest region of the US and adds one of the most well-regarded regional distributors to our company,” said US Foods Chairman and CEO Pietro Satriano.

Apart from access to the Northwest, the deal will give US Foods increased scale and fuel growth and help it achieve about $55 million in annual run-rate cost synergies by 2022.

SGA’s Food Group of Companies has combined 2017 net sales of $3.2 billion, 12 distribution centers, approximately 3,400 employees and more than 20 private brands. SGA’s Food Group of Companies currently operates as five separate operating companies — Food Services of America, systems Services of America, Amreifresh, Ameristar Meats and GAMPAC Express.

Services Group of America evp and COO Slade Stewart said, “For the past 46 years, we have had the vision to become a leading national foodservice company. This is an exciting milestone on our journey and provides more success and growth opportunities for our customers and our associates.”