Sysco Announces Agreement to Acquire The Coastal Companies, a Leading Fresh Produce Distributor

Rhea-AI Summary

Sysco Corporation (NYSE: SYY) announced plans to acquire The Coastal Companies, a fresh produce distributor generating $600 million in revenue. The acquisition aims to enhance Sysco's FreshPoint business in the Mid-Atlantic, providing added manufacturing capabilities and diversifying its produce specialty portfolio. The Coastal Companies comprises three businesses: foodservice distribution, retail distribution, and value-added manufacturing. The deal is pending regulatory approval, and specific financial terms remain undisclosed.

Positive

• Acquisition of The Coastal Companies strengthens Sysco's presence in the Mid-Atlantic region.
• Enhances FreshPoint's service offering with new value-added manufacturing capabilities.
• Diversifies Sysco's produce portfolio, adding retail and ready-to-eat capabilities.

Negative

• None.

HOUSTON, Dec. 06, 2021 (GLOBE NEWSWIRE) -- Sysco Corporation (NYSE: SYY), the leading global foodservice distribution company, announced today it has entered into an agreement to acquire The Coastal Companies, a leading fresh produce distributor and value-added processer, from Continental Grain Company. Upon completion of the transaction, the acquisition will operate as part of FreshPoint, Sysco’s specialty produce business. The acquisition will create a strong FreshPoint presence in the Mid-Atlantic region, provide significant value-added manufacturing capabilities and further diversify Sysco’s produce specialty business.

Founded in 1992 and based in Laurel, MD, The Coastal Companies generates annual revenue of approximately $600 million, and is comprised of three integrated businesses:

• Foodservice Distribution – Coastal Sunbelt Produce a leading foodservice supplier of produce, specialty, fresh-cut and value-added products in the Mid-Atlantic region.
• Retail Distribution – Lancaster Foods is a wholesale supplier of produce and fresh-cut products to retail distribution centers and store locations.
• Value-Added Manufacturing – East Coast Fresh is a regional processor of fresh-cut and value-added products, manufacturing items such as pre-cut fruits and vegetables, salsas, meal preparation solutions and grab-and-go items.
  

”As Sysco continues to invest in our specialty offerings, The Coastal Companies is an outstanding addition to our family of specialty companies and the acquisition reinforces our Recipe for Growth strategy,” said Greg Bertrand, Sysco’s executive vice president of U.S. foodservice. “This exciting acquisition enables FreshPoint to enhance its service to the important Mid-Atlantic region, strategically diversify its portfolio by adding retail and ready-to-eat capabilities and adds state-of-the-art facilities with capacity for growth.”

“We are proud of what we have built at The Coastal Companies and excited about our next chapter of growth,” said John Corso, CEO of The Coastal Companies. “Joining FreshPoint will enable us to enhance our offering, expand our capabilities, and provide even greater value for our customers. It will also create new and exciting opportunities for our people.”

The acquisition is subject to regulatory approval and other customary closing conditions. The terms of the agreement were not disclosed.

About Sysco
Sysco is the global leader in selling, marketing and distributing food products to restaurants, healthcare and educational facilities, lodging establishments and other customers who prepare meals away from home. Its family of products also includes equipment and supplies for the foodservice and hospitality industries. With more than 58,000 associates, the company operates 343 distribution facilities worldwide and serves more than 650,000 customer locations. For fiscal 2021 that ended July 3, 2021, the company generated sales of more than $51 billion. Information about our CSR program, including Sysco’s 2021 Corporate Social Responsibility Report, can be found at www.sysco.com/csr2021report.

For more information, visit www.sysco.com or connect with Sysco on Facebook at www.facebook.com/SyscoFoods. For important news and information regarding Sysco, visit the Investor Relations section of the company’s Internet home page at investors.sysco.com, which Sysco plans to use as a primary channel for publishing key information to its investors, some of which may contain material and previously non-public information. In addition, investors should continue to review our news releases and filings with the SEC. It is possible that the information we disclose through any of these channels of distribution could be deemed to be material information.

About Continental Grain
Continental Grain Company (Conti) is a privately-owned global investor, owner, and operator of companies with more than 200 years of history across the food and agribusiness spectrum. We seek to create long-term value by applying deep industry knowledge, capital and talent to businesses ranging from established market leaders to promising innovators. We build platforms that leverage our strategic expertise in food production, processing, and distribution to source proprietary deals, working alongside trusted partners and supporting strong management teams. We bring a long-term ownership mindset, concentrating on investment and operating plans that seek to create enduring value and a sustainable, efficient and nutritional food supply chain. Conti brings people, ideas and resources together to build the businesses that will feed the world. Visit www.continentalgrain.com to learn more.

For more information contact:
Shannon Mutschler Media Contact Shannon.Mutschler@sysco.com T 281-584-4059	Kevin Kim IR Contact Kevin.Kim@sysco.com T 281-436-1219

FAQ

What is Sysco's acquisition of The Coastal Companies about?

Sysco is acquiring The Coastal Companies to enhance its FreshPoint business, expand its service in the Mid-Atlantic, and diversify its produce offerings.

What is the value of Sysco's agreement to acquire The Coastal Companies?

The specific terms of the acquisition agreement have not been disclosed.

How will Sysco benefit from acquiring The Coastal Companies?

The acquisition will provide Sysco with added manufacturing capabilities and strengthen its market presence in the Mid-Atlantic region.

When was Sysco's acquisition of The Coastal Companies announced?

The acquisition was announced on December 6, 2021.

What are the key businesses under The Coastal Companies?

The Coastal Companies includes foodservice distribution, retail distribution, and value-added manufacturing.