Sysco to pay $312.5m to call off merger with US Foods

Food distributor Sysco Corporation will pay $312.5m in break-up fees after it cancelled its merger with US Foods.

Sysco must pay $300m to US foods and $12.5m to Performance Food Group, which was to buy US Foods facilities in 11 markets under the deal.

The cancellation came days after a US Court granted a preliminary injunction to block the merger.

Sysco president Bill DeLaney said the company considered appealling the court’s decision, but decided to move on.

“We believed the merger was the right strategic decision for us, and we are disappointed that it did not come to fruition. However, we are prepared to move forward with initiatives that will contribute to the success of Sysco and our stakeholders."

Shares in Sysco were down 1.12% to $37.89 at 09:44 in New York on Monday.