US Foods Holding Corp. has entered into a definitive agreement to acquire Smart Foodservice Warehouse Stores from funds managed by affiliates of Apollo Global Management Inc. for $970 million in cash.

Smart Foodservice operates 70 small-format cash-and-carry stores across California, Washington, Oregon, Idaho, Nevada, Utah and Montana that serve small and mid-sized restaurants and other food business customers with a broad assortment of products. Founded in 1955 and headquartered in the greater Portland, OR, area, Smart Foodservice employs approximately 900 associates. Smart Foodservice had 2019 revenues of approximately $1.1 billion and approximately $85 million in adjusted EBITDA (including standalone cost estimates).

“As we continue to expand our multi-channel strategy, we know customers, particularly independent restaurants, increasingly use cash and carry as a convenient, cost-effective purchasing option,” said US Foods Chairman and CEO Pietro Satriano. “With an established footprint and a consistent record of profitable growth, Smart Foodservice will complement our CHEF’STORE cash and carry model and provide a platform to significantly accelerate our presence in this attractive, growing channel.”

Derek Jones, president of Smart Foodservice, said, “The management team at Smart Foodservice very much looks forward to working with the team at US Foods in accelerating our growth in the attractive cash and carry foodservice market. US Foods is an ideal partner for Smart Foodservice and we are excited about the synergistic and strategic benefits of the combination.”

The $17 billion cash-and-carry channel of the foodservice industry is growing at 4-5 percent annually. This channel is especially relevant with small and mid-sized independent restaurants seeking a convenient, cost effective purchasing option.