Sysco agrees to buy Brakes Group for $3.1bn

US-based Sysco has agreed to acquire European foodservice distributor Brakes Group for approximately $3.1bn.

The transaction includes the repayment of around $2.3bn of Brakes Group’s financial debt.

Sysco’s board of directors have unanimously approved the deal, which will enable the company to expand its presence in the UK, Ireland and other regions of Europe.

Subject to regulatory review by European Union competition authorities, the transaction is expected to be closed before the end of Sysco’s fiscal year in July.

Following the completion of the deal, Brakes Group will function as a separate company within Sysco.

Sysco chief executive officer Bill DeLaney said: "We look forward to welcoming Brakes Group, its 15,000 employees, and Ken McMeikan and his highly respected leadership team to the Sysco family of companies.

"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."

Upon completion of the deal, the merged entities are expected to register annual sales of around $55bn.

Bain Capital Private Equity bought Brakes Group in 2007 and since then, the former has invested more than £100m in latter’s e-commerce platform, multi-temperature distribution infrastructure and customer service enhancement activities.

Brakes Group serves customers such as pubs, restaurants, hotels, hospitals, schools, contract caterers.