Ahold , the Dutch supermarket group, on Wednesday night announced the sale of its US Foodservice unit to Clayton Dubilier & Rice and Kohlberg Kravis Roberts for $7.1bn.
CD&R’s interest in the food distribution business was first reported by the Financial Times in November. It later teamed up with KKR to see off competing interest from rival private equity groups, including Blackstone, for an asset that ranks second in the US market behind Sysco.
CD&R was always well-placed as it had previously owned parts of USF and knows important executives. In 2001, the private equity group sold Alliant, now a chief constituent of USF, to Ahold in a $1.45bn deal.
USF’s disposal for about $7bn including debt, which rounds off a seven-month divestment programme that included the sale of underperforming US and European stores, will fire speculation about Ahold’s next step.
Last week, Anders Moberg, Ahold’s Swedish chief executive, unexpectedly announced his departure. He will leave in July, nine months early, to “pursue other career interests”.
Ahold, which holds its annual shareholders’ meeting in Amsterdam on Wednesday, is itself seen as a potential private equity target. Another option, analysts think, would see it return to the negotiating table with Delhaize, the Belgian retailer with whom it discussed a merger last year.
Hedge fund investors have been pressing Ahold to consider a break-up, arguing there are few synergies in the structure.
While shareholders have welcomed the decision to sell USF, they want Ahold to go further. Ahold could merge with Delhaize and split the retail operations into two listed vehicles.
Ahold has promised to return the bulk of the proceeds from the USF sale to investors in the form of a €3bn ($4bn) buyback.
The sale draws a line under the most turbulent period in Ahold’s history. The US unit was at the centre of an accounting scandal in 2003 that almost bankrupted its parent.
Ahold bought USF for $3.6bn in March 2000, a decision intended to catapult the supermarket group into the field of food distribution. It later bought the third- and fourth-largest food distribution groups in the US, bolting them on to USF at a total cost of more than $6.6bn.
Last year, USF customers launched a class action suit against the distribution group, alleging it had engaged in “racketeering”. Ahold denies the allegations.
CD&R and KKR declined to comment.