PFG agrees to acquire Core-Mark in $2.5B cash-and-stock deal to expand in c-store channel

Mammoth transaction adds 7,500 employees, 32 distributions centers, premium fresh-prepared foods

Performance Food Group (PFG) agreed to acquire Core-Mark, one of the top distributors in the convenience-store channel, with revenues of $17B and $211M in adjusted EBITDA. The transaction, valued at $2.5B, will be funded through cash and stock: PFG will offer $23.75 in cash and 0.44 PFG shares for each share of CORE to Core-Mark existing shareholders.

The transaction, approved unanimously the Board of Directors of both companies, is expected to be completed in the first half of calendar 2022 if it clears all regulatory hurdles and receives Core-Mark shareholder approval. PFG will use its asset-based revolving credit facility and the issuance of new senior unsecured notes to finance the purchase of Core-Mark.

At closing, Core-Mark shareholders will own 13 percent of the combined company.

The combination of Core-Mark and PFG’s Eby-Brown established competencies in the convenience-store (c-stores) channel, along with Vistar’s prepared foods program, will form a valuable enterprise moving forward, suggest PFG executives.

Core-Mark acquisition rationale

Core-Mark, with $17B in revenue, will boost the sales of PFG, which will increase to $44B based on LTM sales. By comparison, Eby-Brown’s revenue was $5.3B when PFG acquired it in 2019.

Plus, Core-Mark knows how to take care of customers, operating in a customer-centric fashion and meeting customer demand. PFG executives hope to build on that model by helping Core-Mark generate demand through value-added options and solutions, suggested executives on an analyst conference call regarding the deal.

The acquisition of Core-Mark delivers to PFG an attractive customer base and new products. In fact, Core-Mark excels in fresh and prepared offerings, which will now be at PFG’s disposal.

The transaction will be accretive to EPS in the first full year following the closing, and PFG will realize $40M in synergies on an annualized run-rate basis by the third year after closing.



Following the closing, the expanded convenience business will continue operating under the Core-Mark brand and Scott McPherson will retain his role as president and chief executive officer. Meanwhile, Eby-Brown will continue to operate in Naperville, Ill. under the leadership of Tom Wake, president and chief executive officer.

“Core-Mark is an outstanding company that we believe will significantly strengthen our business diversification and expansion into the convenience store channel,” said George Holm, PFG chairman, president and chief executive. “Core-Mark brings a highly skilled and experienced workforce along with an experienced senior leadership team, which will be valuable additions to the PFG family of companies. This transaction will also combine Core-Mark’s footprint and operational excellence with PFG’s existing capabilities in both convenience and foodservice.”

With 7,500 employees and 32 distribution centers across the United States and Canada, Westlake, Texas-based Core-Mark services about 40,000 customer locations in two countries.

“On behalf of PFG’s Vistar segment, I echo George’s enthusiasm for this transaction,” said Patrick Hagerty, executive vice president of PFG and chief executive of Vistar. “Adding convenience store distribution in 2019 built up the core strength of our organization, providing another important avenue for growth. Bringing Core-Mark to PFG will continue this journey and complement our existing portfolio. I look forward to us bringing together the best talent in convenience and welcoming Core-Mark associates at close.”


BMO Capital Markets Corp. acted as the exclusive financial advisor to PFG, while J.P. Morgan Securities LLC provided a fairness opinion to PFG’s Board. Skadden, Arps, Slate, Meagher & Flom LLP advised PFG on legal matters. Barclays served as exclusive financial advisor to Core-Mark. Weil, Gotshal & Manges LLP advised the c-store distributor on legal matters.

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