US Foods Holding Corp. (NYSE: USFD) has filed an S-1 form with the U.S. Securities and Exchange Commission (SEC) for its secondary offering. The selling stockholders plan to offer 35.0 million shares, with an overallotment option for an additional 5.25 million shares. At the most recent closing price of $28.00, the entire offering is valued up to $1.13 billion.
Keep in mind that this company has a total market cap of just over $6 billion.
The underwriters for the offering are Goldman Sachs, Morgan Stanley, JPMorgan, Merrill Lynch, Citigroup, Credit Suisse, Deutsche Bank, Wells Fargo, KKR, BMO Capital Markets, BTIG, Guggenheim, ING, Rabo Securities and Natixis.
US Foods is among America’s great food companies and one of only two foodservice distributors with a national footprint in the United States. With net sales of $23 billion in the fiscal year ended in December, this company is the second largest foodservice distributor in the United States with a 2016 market share of roughly 8%. The U.S. foodservice distribution industry is large, fragmented, and growing, with total industry sales of about $280 billion in 2016, according to Technomic (February 2017).
The company supplies roughly 250,000 customer locations nationwide. These customer locations include independently owned single and multi-unit restaurants, regional restaurant concepts, national restaurant chains, hospitals, nursing homes, hotels and motels, country clubs, government and military organizations, colleges and universities, and retail locations.
In the filing the company described its finances as follows:
As a result, from fiscal 2013 through fiscal 2015 our net sales grew at a CAGR of 1.8%. After failing to obtain regulatory approvals, the Acquisition Agreement was terminated on June 26, 2015. Since then, we have refocused on executing our strategy of bringing innovative products to market, expanding our portfolio of business solutions for customers, and driving advancements in technology. For the fiscal year ended December 31, 2016, we generated $22.9 billion in net sales, $210 million in net income, and $972 million in Adjusted EBITDA.
The company will not receive any proceeds from the offering, instead the selling stockholders will receive all proceeds.
Shares of US Foods traded at $28.48 on Thursday, with a consensus analyst price target of $29.75 and a 52-week trading range of $22.19 to $29.26.