USA: Performance Food Group completes acquisition of Empire Seafood
Highlights of the acquisition:
- Doubles sales in expanding seafood category
- Broadens proprietary brand offerings of center-of-the-plate items
- Offers marketing and purchasing synergies with broadline operations
- Expected to be accretive to earnings per share in 2001 and 2002
Performance Food Group (Nasdaq/NM:PFGC) yesterday announced that it has completed the acquisition of all of the common stock of privately-owned Empire Seafood Holding Corp. ("Empire"), a leading distributor of seafood. The total consideration paid for the acquisition, including assumed debt, was approximately $75 million, of which approximately $20 million was represented by 400,000 shares of common stock of Performance Food Group. The transaction will be accounted for as a purchase.
Empire, based in Miami, is a leading distributor and processor of seafood. The company, which is projecting to generate net sales of approximately $120 million for 2001, markets a broad array of quality seafood directly to independent restaurants and other foodservice operators, primarily in Florida.
Robert C. Sledd, Chairman and Chief Executive Officer of Performance Food Group, remarked, "Our immediate focus is successfully integrating Empire into our distribution network and then leveraging Empire's expertise in seafood across our system. We are very excited about the strength Empire gives us in the expanding seafood product category. In addition, Empire's products, which are marketed primarily under the Empire label, fit nicely with our strategy of increasing sales of our proprietary branded items that offer added value to our customers. As previously indicated, Empire's business is seasonal with the first and fourth quarters serving as the strongest periods of the year. We expect Empire to contribute 1-2 cents to Performance Food Group's earnings per share in the fourth quarter of 2001. Based on a full-year inclusion of Empire, and the benefit of the anticipated increased volume, we expect a contribution of 3-5 cents to earnings per share in 2002. We believe the longer term prospects are excellent for continued growth in Empire's product line as we combine Empire's procurement expertise with our existing volume in this product category."
Henry Torres, President of Empire, remarked, "Our initial work with Performance Food Group is affirming our expectation that this combination will be a very positive step forward for Empire. Performance Food Group gives us access to a substantially larger distribution network upon which we can grow our business. We are excited about this opportunity to contribute to the Company's growth."
Performance Food Group markets and distributes more than 31,000 national and private label food and food-related products to approximately 27,000 restaurants, hotels, cafeterias, schools, healthcare facilities and other institutions. For more information on Performance Food Group, visit www.pfgc.com.
Certain statements made herein are forward-looking statements under the Private Securities Litigation Reform Act of 1995. They include statements regarding anticipated earnings for next year, sales momentum, customer and product sales mix, expected efficiencies in the Company's business and the ability of Performance Food Group to realize expected synergies following acquisitions. These statements involve risks and uncertainties and are based on current expectations and management's estimates; actual results may differ materially. The risks and uncertainties which could impact these statements include, but are not limited to, the relatively low margins and economic sensitivity of the foodservice business, the Company's reliance on major customers, the ability to identify and successfully complete acquisitions of other foodservice distributors and management of the Company's planned growth, all as detailed from time to time in the reports filed by the Company with the Securities and Exchange Commission.
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