- Deal closing expected first half of 2022
- Follows PFG’s March acquisition of Eby-Brown
(Reuters) – Skadden, Arps, Slate, Meagher & Flom and Weil, Gotshal & Manges are steering food distributor Performance Food Group Co’s plans to acquire major convenience store supplier Core-Mark Holding Co Inc in a $2.5 billion deal.
Performance Food Group said the acquisition, announced on Tuesday, would expand its own convenience store- and vending-focused Vistar unit, which will continue to operate under the Core-Mark brand.
The deal is expected to wrap up in the first half of 2022.
Representatives for Skadden and Weil did not immediately respond to requests for comment Tuesday.
A Skadden team led by mergers and acquisitions partner Jeremy London, counsel Micah Kegley and associate Paul Bolaji is advising PFG.
Skadden previously advised the Richmond, Virginia company on its $2 billion 2019 purchase of Reinhart Foodservice LLC, one of the largest food distributors in the U.S, according to a firm press release.
PFG’s Core-Mark buy raises the number of deals Skadden has advised on so far this year to 96. The firm has guided more than $234.75 billion worth of transactions since 2021 started, Refinitiv data shows.
Skadden currently ranks third based on the total value of M&A deals it has advised on, following Sullivan & Cromwell, which shot up to first place Monday, and Latham & Watkins.
On the other side of the deal, Texas-based Core-Mark is working with a Weil team led by M&A partner Craig Adas.
Weil also is representing Core-Mark in the multi-district litigation facing vape maker Juul Labs Inc, and several e-cigarette manufacturers and distributors over the devices’ alleged impact on minors’ health, according to a firm press release.
Including Core-Mark, Weil has advised on 79 M&A deals that are collectively worth about $77.57 billion in 2021, according to Refinitiv.
As part of the deal terms, Core-Mark’s stakeholders can hand in their shares for $23.875 each in cash and 0.44 of a PFG share, according to a PFG press release. Core-Mark’s shareholders are expected to own a roughly 13% stake in the combined company.
Once the transaction closes, the acquisition will add $17 billion in net sales to PFG’s books, giving PFG total net sales of about $44 billion in a 12-month period.
Core-Mark operates 32 distribution centers in the U.S. and Canada, which serve 40,000 customer locations, according to the press release.
The deal comes two months after PFG agreed to purchase Eby-Brown Co LLC, the third largest wholesale consumer products distributor in the convenience industry.
PFG’s financial advisor is BMO Capital Markets Corp; Core-mark’s is Barclays. J.P. Morgan Securities provided a fairness opinion to PFG’s board.
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