Performance Food Group Co. announced on Sep. 1 said that it has completed the $2.5 billion acquisition of Core-Mark Holding Co. Inc., dba Core-Mark, one of North America's largest wholesale distributors to the convenience retail channel. Core-Mark is now part of the PFG family of companies, which includes vend distribution leader Vistar.
With about $17 billion in net sales, Core-Mark has 8,000 employees and operates 32 distribution centers in the U.S. and Canada. It delivers to 41,000 customer locations in all 50 U.S. states and five Canadian provinces.
According to officials, the transaction creates a best-in-class convenience business within PFG’s Vistar segment that includes the Core-Mark and Eby-Brown businesses. The expanded convenience business will continue to operate under Core-Mark and will be headquartered in Westlake, TX, with Eby maintaining ongoing operations in Naperville, IL.
Scott McPherson will continue in his role as Core-Mark, and Tom Wake will continue as president and chief executive Eby-Brown, with Wake reporting to McPherson.
“We are very pleased to close this acquisition and welcome Core-Mark’s many talented associates to PFG,” said PFG chairman, president and chief executive George Holm. “Core-Mark has proven itself to be a leader in convenience distribution and we are thrilled to add their leadership strength to the strong senior talent already driving PFG’s success in the foodservice and convenience distribution industries.
"We are excited to begin the integration process and start to service Core-Mark’s customers with the combined suite of brands," Holm added. "By adding PFG’s food and foodservice capabilities to Core-Mark’s solid platform, we expect to quickly begin to unlock the transaction value.”
- The Core-Mark acquisition accelerates PFG’s diversification and adds highly complementary assets in the convenience store channel. It expands PFG’s geographic reach and market diversification into the growing convenience store channel.
- The acquisition adds complementary customer-centric operating model, as Core-Mark brings a consistent go-to-market approach with a selling culture focused on customer success.
- The acquisition enhances attractive customer base and product offerings. The transaction builds upon PFG’s current foodservice focus within the convenience channel adding additional customers and product offerings, particularly in the fresh food space.
- Core-Mark brings strong strategic and financial merits. The transaction is expected to be accretive to adjusted diluted EPS in the first full fiscal year following the close. The accretion calculation does not include any of the expected cost synergies.
- Annual run-rate net cost synergies of about $40 millionare expected to be achieved by the third full year after closing.
Headquartered in Richmond, Virginia, Performance Food Group Co. markets and delivers food, beverages and related products to more than 250,000 locations through a network of over 100 distribution facilities.