The Federal Trade Commission (FTC) has filed an administrative complaint arguing that a proposed merger of US Foods and Sysco would violate antitrust laws, resulting in higher prices and diminished service for the companies’ customers. In re Sysco Corp., No. 9364 (FTC, filed February 19, 2015).
The complaint asserts that a merger of Sysco and US Foods, the largest broadline foodservice distributors in the United States, would account for 75 percent of the national market for broadline distribution services. The sale of 11 US Foods distribution centers to another distributor would not counteract the significant competitive harm caused by the merger, FTC argues. “This proposed merger would eliminate significant competition in the marketplace and create a dominant national broadline foodservice distributor,” Debbie Feinstein, the director of FTC’s Bureau of Competition, said in February 19, 2015, press release. “Consumers across the country, and the businesses that serve them, benefit from the healthy competition between Sysco and US Foods, whether they eat at a restaurant, hotel, or a hospital.” See FTC Press Release, February 19, 2015.