USA: Performance Food Group to acquire Empire Seafood
Highlights of the agreement:
- 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
Performance Food Group (Nasdaq/NM:PFGC) today announced that it has signed a definitive agreement to acquire privately-owned Empire Seafood Holding Corp. ("Empire"), a leading distributor of seafood. The total consideration to be paid for the acquisition is approximately $70 million, consisting of cash and common stock of Performance Food Group, plus the assumption of certain liabilities. The transaction, which remains subject to customary closing conditions, will be accounted for as a purchase. Closing is expected early in the second quarter.
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 companies, primarily in Florida.
Robert C. Sledd, Chairman and Chief Executive Officer of Performance Food Group, remarked, "We are excited about the potential this acquisition offers. We will significantly strengthen our position in the expanding seafood category. The addition of Empire's products, which are marketed primarily under the Empire label, will also broaden our line of proprietary branded items that can offer particular value to customers throughout our distribution system. One of our merchandising strategies is to add branded, center-of-the-plate products; and this transaction fits directly with that objective."
Sledd added, "Due to the seasonality of Empire's business, the first and fourth quarters are the strongest periods during the year. We expect Empire to contribute 1-2 cents to Performance Food Group's earnings per share in the fourth quarter of 2001. We expect more accretion to earnings per share for 2002 when Empire will be included for a full year, and we will have the benefit of its first quarter results. We also expect to gain more advantages during 2002 from the assimilation of Empire's product line with ours."
Henry Torres, President of Empire, remarked, "We believe that this strategic alliance with Performance Food Group will yield substantial benefits for our customers, suppliers and associates. We will have a strong financial partner to support our growth plans and will have the longer term potential of linking our distribution network with one of the fastest growing foodservice organizations in our industry."
Bailin Inc. is assisting Performance Food Group with this transaction.
Performance Food Group markets and distributes more than 25,000 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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