Food Service Holdings Ltd history

John Sexton & Co. began as a tea and coffee merchant in Chicago in 1883.

Ben’s brother, Frank Gordon, joins the company in 1937.

Sowing the Seeds of an Industry: 1940-70

The first distinction between the two groups came about in 1951, with the formation of the Association of Institutional Distributors.

Acquisitions included Valley Industries of Las Vegas, Arrow Paper and Supply Company, based in Connecticut, Squeri Food Service of Cincinnati, and Mazo-Lerch Company, Inc., the 70-year-old food distributor based in northern Virginia that had held the first food fair in 1953.

In 1958, Mazo-Lerch held the first food show, and was one of the first distributors to offer both custom-cut meats and beverage dispenser programs.

In 1965, Americans spent just 20 cents of every food dollar for food away from home.

SYSCO went public in 1970 and that year made its first acquisition, o f Arrow Food Distributor.

Consolidated Foods bought the old Pearce-Young-Angel distribution network in 1971 and merged it with its Monarch Foods subsidiary to form PYA/Monarch, which would eventually become the foundation of US Foodservice.

S.E. Rykoff went public in 1972, one of the few foodservice distributors to do so.

In 1976 SYSCO acquired Mid-Cen tral Fish and Frozen Foods Inc., expanding the company's distribution capabilities around the nation.

1981: SYSCO becomes the largest United States foodservice distribution company.

By 1982, the foodservice distribution was a $69 billion industry.

S.E. Rykoff bought Sexton & Co. in 1983, in what was then the largest acquisition in the industry.

Meanwhile, in Greenville, South Carolina, number two PYA/Monarch bought Fleming Foodservice of Austin, Texas, raising its 1984 sales volume to an estimated $1.3 billion.

By 1986, Americans were spending one-third of every food dollar outside the supermarket, and the foodservice distribution had grown to a $78 billion industry.

One of SYSCO's largest acquisi tions occurred in 1988, when the company paid $750 million for CF S Continental, at that time the third largest food distributor in the country, which added 4,500 employees and increased the number of mar kets SYSCO served to 148 out of the top 150 markets.

In June 1989, members of PYA/Monarch management incorporated a new entity, JPF Holdings, Inc.

JP Foodservice Distributors passed the $1 billion mark in its first year, with sales for fiscal 1990 of $1.02 billion.

1991: SYSCO creates a subsidiary called the SYGMA Network, Inc . to consolidate its chain restaurant distribution systems.

In November 1994, five years after it was created, the company adopted the name JP Foodservice, Inc. and went public in November, listed on the NASDAQ under the symbol JPFS. Sara Lee Corporation now held 37 percent of JP common stock.

JP's business, which for fiscal 1995 reached $1.12 billion, was about 55 percent independent (hospital cafeterias, family-owned restaurants) and 45 percent chains.

Yet the two companies failed to reach agreement on several factors, including valuation (JP's stock price had gone up in expectation of the merger), structure, and dilution of earnings to existing shareholders, and the deal fell through in February 1996.

By 1997 SYGMA consisted of 11 distribution centers serving customers in 37 states, and posted sales of $1.3 billion.

In the $141 billion industry, according to a July 1998 article in Baltimore Business Journal, the top 50 companies accounted for only 28 percent of sales, and most of those sales, 23.7 percent, were by the ten biggest companies.

New fold-outs were being created about every six months, and several significant acquisitions were co mpleted in 1999.

One of Cotros's first tasks was shepherding thr ough one of the company's largest deals, the 2000 purchase of FreshPo int Holdings, one of the biggest distributors of wholesale produce in the United States.

Early in 2001 SYSCO acquired a group of specialty meat supply operati ons in Texas, doing business under the names Freedman Food Service an d Texas Meat Purveyors, that specialized in supplying fresh meat to u pscale restaurants.

In May 2002 the company opened its first niche fold-out: a Buckhead Beef branch that began providing fresh-cut meat to the Ne w York metropolitan area.

International Food reported 2003 revenues of $77.8 million.

By fiscal 2004 SYSCO's steadily rising revenues had reached $29.3 4 billion, a 12.2 percent increase over the previous year, while earn ings rose 16.6 percent, to $907.2 million.

SYSCO managed to achieve gains in both sal es and earnings for the 29th straight year in fiscal 2005, but the ga ins were very small, 6 percent for earnings, which totaled $961.5 million, and just 3.2 percent for revenues, which nevertheless passe d the $30 billion mark for the first time.