(By Balaseshan) Foodservice distributor SYSCO Corp. (NYSE: SYY) said it has agreed to buy the assets of Distagro, the foodservice division for Montreal, Quebec-based grocery retailer Metro Richelieu Inc.
Sysco also closed on the purchase of the foodservice distribution arm of Ireland-based produce company Keelings Foods on October 3. While the specific financial terms of the two acquisitions were not disclosed, the combined annual sales of the entities approach $400 million.
The acquisition of Distagro's foodservice division is designed to complement Sysco's growing presence in the competitive Quebec market. Distagro supplies food products to customers with operations in Quebec and Eastern Canada.
Additionally, within the past 13 months in Quebec, Sysco has acquired Frank and Dino, a Montreal broadline specializing in Italian imports; Viandes St. Laurent, a Montreal meat processor and distributor; and En Gros Pierre, a Montreal seafood company.
The acquisition of Keelings' foodservice distribution business expands Sysco's presence and significantly strengthens its produce offering in Ireland. Having acquired Pallas Foods in 2009, Sysco acquired Crossgar Foodservice, a leading supplier in Northern Ireland, in August 2012.
The acquired Keelings business specializes in delivering fresh produce, employs 160 and has operations based in Dublin, Cork, Belfast and Wexford. The business will retain its existing brand identity and management team, and all employees will remain with the business.
"These acquisitions demonstrate Sysco's commitment to pursue quality organizations that will help us better serve our customers, improve our service footprint, grow our business and achieve our goal of increasing sales by one-half percent to 1 percent annually through acquisitions," said Chris Kreidler, Sysco's executive vice president and chief financial officer.
SYY is trading down 0.71% at $30.70 on Monday. The stock has been trading between $26.48 and $31.90 for the past 52 weeks.