Sysco Seeks to Purchase Restaurant Depot

Restaurant wholesaler Sysco recently made a bid to purchase the parent company of rival "cash-and-carry" restaurant wholesaler Restaurant Depot. The deal contemplates Sysco paying $21.6 billion in cash and 91.5 million Sysco shares, representing a total enterprise value of approximately $29.1 billion.

Many small and independent brewers rely on Sysco and Restaurant Depot for critical supplies to run a brewpub or taproom. These include both food and non-food items. Research by the Independent Restaurant Coalition suggests that Sysco and Restaurant Depot customers often compare prices between the two and may play one against the other in seeking the best quality and price. As such, combining the two companies could reduce competition, leading to higher prices and/or less quality.

The Federal Trade Commission (FTC) is reviewing the transaction and has issued a "second request," signaling that the agency may see competitive problems with the proposed acquisition. In addition to the FTC, several state attorneys general are scrutinizing the proposed transaction for potential anti-competitive effects.

The Brewers Association is keeping a close eye on this merger and welcomes member feedback on how an acquisition of Restaurant Depot by Sysco could impact your brewery.