) completed the acquisition of four independent foodservice
companies in December 2012. These companies are as follows:
• Appert's Foodservice in St. Cloud,
• Buchy Food Service, in Greenville, Ohio
• Central Seafood Company, in Orlando, Florida
• Distagro, the foodservice division of
Montreal, Quebec-based grocery retailer, Metro Richelieu Inc.
The aggregate annual revenues of these four companies are $520
A peer of
Procter & Gamble Co.
), Sysco believes in growing through acquisitions, since the
company operates in a highly fragmented industry. It intends to
achieve sales growth of 0.5% to 1% through acquisitions in the
long term. To date, the company has already acquired a total of 9
companies, whose aggregate annual revenue is over $750 million.
Among its acquisitions, Sysco has made three acquisitions in
Ireland. Having acquired Pallas Foods in 2009, Sysco acquired
Crossgar Foodservice, a leading supplier in Northern Ireland, in
August 2012 and the foodservice distribution division of Keelings
in October 2012.
The takeover of Distagro's foodservice division will
complement Sysco's growing presence in the competitive Quebec
market as it supplies food products to customers with operations
in Quebec and Eastern Canada.
Sysco Corporation carries a Zacks Rank #3 (Hold). We have a
Neutral recommendation on Sysco Corporation.
We appreciate the company's strategy of growth through
acquisitions and its efforts to reduce cost and improve
efficiency. However, we are concerned about rising costs due to
fuel price hikes and other inputs, which hurt margins.
PROCTER & GAMBL (PG): Free Stock Analysis
SYSCO CORP (SYY): Free Stock Analysis Report
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