PERFORMANCE FOOD GROUP TO BUY CORE-MARK FOR $2.5 BILLION

Performance Food Group Co. announced yesterday that it will acquire Core-Mark Holding Co. Inc. in a stock and cash deal valued at $2.5 billion, creating a best-in-class convenience business within PFG’s Vistar segment that will include the Core-Mark and Eby-Brown businesses.

The deal builds upon PFG’s current foodservice focus within the convenience channel, adding additional customers and product offerings, particularly in the fresh food space, the company said.

PFG said the expanded convenience business will operate under the Core-Mark brand and will be based in Westlake, Texas, and Eby-Brown will continue to operate in Naperville, Illinois. Scott McPherson will remain Core-Mark president and chief executive officer, following closing of the transaction. Tom Wake will continue as president and CEO of Eby-Brown, reporting to Mr. McPherson.

“Core-Mark is an outstanding company that we believe will significantly strengthen our business diversification and expansion into the convenience store channel,” said George Holm, PFG chairman, president and chief executive officer. “Core-Mark brings a highly skilled and experienced workforce along with an experienced senior leadership team, which will be valuable additions to the PFG family of companies.”

PFG entered the convenience store distribution business in 2019, a move which “built up the core strength of our organization, providing another important avenue for growth,” said said Patrick Hagerty, executive vice president of PFG and CEO of Vistar. “Bringing Core-Mark to PFG will continue this journey and complement our existing portfolio. I look forward to us bringing together the best talent in convenience and welcoming Core-Mark associates at close.”

Under the terms of the deal, which has been unanimously approved by both companies’ board of directors, Core-Mark shareholders will receive $23.875 per share in cash and 0.44 PFG shares for each Core-Mark share. When the deal closes, Core-Mark shareholders will own about 13% of the combined company.

Core-Mark is one of the largest wholesale distributors to the North American convenience retail industry with roughly $17 billion in net sales. The company has about 7,500 employees and operates 32 distribution centers across the U.S. and Canada. Core-Mark services about 40,000 customer locations in all 50 states in the U.S., five Canadian provinces and two Canadian territories.

“This transaction brings together two companies known for their customer-focused approach and dedication to their employees,” said Scott McPherson, Core-Mark president and CEO. “As part of our continuous focus to maximize shareholder value and better serve our customers, our Board evaluated the transaction and determined this combination provides our investors immediate value and the opportunity to participate in the upside potential of being part of a larger, diversified and customer-centric supplier in the foodservice and convenience retail industry. The combination of our two highly complementary businesses creates an even stronger platform to drive growth, as we deliver a best-in-class offering to our customers. I’d like to thank the entire Core-Mark team for their hard work.”

The transaction is expected to close in the first half of calendar 2022, subject to U.S. federal antitrust clearance, Core-Mark shareholder approval, and other customary closing conditions. The transaction is not subject to PFG shareholder approval.

For more information about Performance Group Co. visit https://www.pfgc.com/, (804) 484-7700.