Shares of Sysco Corp (NYSE:SYY) fell more than 2% in premarket trading on Monday after a Bloomberg report said the food distribution giant is close to acquiring family-owned Restaurant Depot in a transaction valued at about $29 billion, including debt.
According to the report, Restaurant Depot shareholders would receive $21.6 billion in cash along with 91.5 million Sysco shares. Once completed, the share component would give them roughly 16% of Sysco’s outstanding common stock.
The total deal value of approximately $29.1 billion, including assumed debt, represents a valuation of more than 14 times Restaurant Depot’s operating income, the report said, citing people familiar with the negotiations.
To finance the transaction, Sysco plans to raise around $21 billion through new and hybrid debt, supplemented by about $1 billion in existing cash and equity resources. The company also intends to suspend its share repurchase program in order to focus on reducing leverage after the acquisition closes.
Strategically, the transaction would allow Houston-based Sysco to expand into the cash-and-carry distribution segment, where small restaurant operators and independent food businesses purchase products directly from warehouse locations without needing to place advance orders or arrange deliveries.
Restaurant Depot currently runs 166 warehouse-style outlets across 35 U.S. states and generated roughly $16 billion in revenue in 2025.
Sysco, which has a market capitalization of around $40 billion, supplies food products to restaurants, hospitals, hotels and entertainment venues through more than 330 distribution centers across 10 countries. The company recorded over $81 billion in sales last year. Unlike Restaurant Depot’s membership-based walk-in model, Sysco’s core business typically involves larger orders delivered directly to customers.
Restaurant Depot’s roots date back to a Brooklyn warehouse opened in 1976 under the name Jetro Cash & Carry, before the business adopted the Restaurant Depot brand in the 1990s.
Following completion of the acquisition, Restaurant Depot is expected to continue operating as a separate business division within Sysco. Its current management team would remain in place and report to Sysco Chief Executive Kevin Hourican. The report also said no job cuts are planned at either company.
Sysco has spent recent years rebuilding its operations after the COVID-19 pandemic disrupted global food-service supply chains, leaving the company in a stronger position to pursue large acquisitions.