US Foods is reportedly in talks to buy Performance Food Group Co., according to Bloomberg. The potential acquisition would create the largest food distribution company in the U.S.
Sources told Bloomberg that US Foods “has been evaluating an acquisition of Performance Food and expressed interest about a potential combination in recent months.” The publication added that no deal is guaranteed.
Together, US Foods and Performance Food would occupy 18 percent of the $371 billion food distribution market, making it the No. 1 player in the segment, according to Bloomberg Intelligence.
Performance Food does well with independent pizzerias, convenience stores, and candy and snacks, all areas of weakness for US Foods, according to Transport Topics, which viewed a note from senior analyst Michael Halen. He added that a merger would create scale and synergies, but hurt US Foods’ EBITDA margins.
Sysco is currently the largest food distribution company in the U.S., earning around $64 billion in sales in 2024. Meanwhile, Performance Food and US Foods are the second and third largest, at $58.3 billion and $37.9 billion.
Both Performance Food and US Foods have made their own smaller acquisitions in recent years. The latter has purchased Renzi Foodservice, Saladino’s Foodservice, and IWC Foodservice. The former has bought Reinhart Foodservice, Eby-Brown, Core-Mark Holding Company, and Cheney Brothers.
The potential deal is likely to face concerns over reduced competition and violation of antitrust laws.
Nearly 12 years ago, Sysco announced plans to buy US Foods for $8.2 billion. However, a court blocked the deal two years later.
