Sysco will buy its rival US Foods creating a food distribution giant. After the $3.5 billion deal is final, Sysco expects its annual sales to grow to about $65 billion. The combined company will now have a quarter of the food distribution market in the U.S. US Foods will take a 13% stake in the new company. Shares of Sysco were trading at an all-time high today up more than 9.5% to $37.62.
Another food deal today, packaged food company, Whitewave foods is buying private Earthbound Farms for $600 million. It’s part of a strategy to expand its organic offerings. Whitewave is already the parent of organic dairy brands like Silk and Horizon Organics. The new purchase, Earthbound Farms, is the largest organic produce brand in North America. Shares of Whitewave grew more than 5% to $22.92.
McDonald’s reported more sluggish sales in November. Sales in the U.S. decreased as competition got tougher and traffic was flat. Global sales didn’t change from October which also disappointed investors. McDonald’s shares fell 1% to $95.72.
Covidien & Given Imaging
Covidien is buying medical diagnostic company Given Imaging. Given makes a remote imaging system that allows doctors to diagnose stomach diseases with its ingestible pill cam, a wireless camera that sends back video of patients digestive tract. The $860 million purchase of the med tech company is 27% more than Given’s Friday closing price. Shares of Covidien were up a fraction to $68.13 on the news, given imaging soared up 27% to $30.06.
Abercrombie & Fitch
Just last week we told you that an activist hedge fund was pressing Abercrombie & Fitch to search for a new CEO. It doesn’t look like the teen retailer is taking the funds’ advice. Abercrombie renewed its CEO’s contract which was due to expire in February. The chain did, however, say it was tying its CEO’s compensation more closely with the company’s performance in new agreement. The stock fell 2% to $34.10.
Mosaic will buy back about 10% to its outstanding stock a $2 billion purchase from Cargill trusts. The world’s largest phosphate- fertilizer maker said the move will wind down ties between Mosaic and Cargill. The transaction is expected to be finalized over the next 8 months. Mosaic shares were down more than 1.5% to $46.00.