US Foods to Divest Chef’Store Business

US Foods Holding Corp. recently announced that it will be divesting its Chef’Store chain, just months after unveiling plans to expand its footprint with five new locations. This decision comes as part of the company’s broader focus on strengthening its core broadline business. During its 2024 investor day event, US Foods reiterated its commitment to growing its main foodservice distribution operations, signaling a shift away from its Chef’Store cash and carry retail business.

Despite the planned divestment, US Foods remains dedicated to the continued success of Chef’Store, with plans to open five new stores later this year, expanding the chain to around 95 locations across 14 states. The company emphasized that the divestiture process would not impact Chef’Store’s day-to-day operations or its commitment to serving both customers and associates.

Courtesy of US Foods – Chef’store

In February, US Foods had announced its expansion of Chef’Store into new markets, including Beaverton, Ore., and Virginia Beach, Va., with the goal of offering restaurant-quality products to independent restaurant owners and foodservice operators. However, US Foods has acknowledged that the anticipated synergies from the Chef’Store acquisition were limited, prompting the decision to explore strategic alternatives for the business.

The move to sell Chef’Store aligns with US Foods’ strategy to focus on its core broadline operations, which now represent the bulk of its revenue. With this shift, the company aims to solidify its position as a pure-play U.S. foodservice distributor. Furthermore, US Foods plans to reinvest the resources from Chef’Store’s sale into its broader operations, bolstering shareholder value.

This change in direction is part of a larger initiative to enhance US Foods’ financial outlook, which includes a new $1 billion share repurchase program aimed at delivering long-term value to shareholders.