NEW YORK—Sysco CEO Kevin Hourican said he is confident the company's $29 billion acquisition of Jetro Restaurant Depot will secure regulatory approval and close in the first quarter of 2027.
The deal is under additional regulatory scrutiny after the government issued a second request for information, following Sysco's March announcement that it would acquire the family-owned chain.
The history is not favorable. Regulators blocked Sysco's $3.5 billion acquisition of rival U.S. Foods in 2015 after a federal judge sided with the Federal Trade Commission, which argued the combination would reduce competition and raise prices.
Hourican said this deal is different. He pointed to distinct customer bases and distribution models as the core argument.
Restaurant Depot primarily serves smaller independent restaurants and food-service operators who travel to its warehouses, select products and transport them back to their businesses. Sysco focuses on larger customers who require direct delivery of food and supplies, along with services such as sales support, menu administration and culinary innovation.
"We have our cash-and-carry customer who's choosing to go to the Restaurant Depot store to buy their product to save money," Hourican said. "We have a delivery-primary customer who wants delivery." He said he believes those differences will be clear to regulators during the review.
The acquisition would expand Sysco into the higher-margin cash-and-carry business and add Restaurant Depot's approximately 166 warehouse locations across 35 states to Sysco's existing delivery network.
Sysco intends to preserve Restaurant Depot's low-cost model. Hourican said the company "will absolutely not be raising prices at Restaurant Depot" and plans to expand the model into additional markets.
"The entire purpose of this deal is to bring that phenomenal Restaurant Depot business model to hundreds of additional locations, which creates affordability and creates thousands of jobs," Hourican said.
