Des Moines, Iowa — Two food distribution companies are considering a merger, and nine states’ attorneys general are not in favor of it.
Iowa Attorney General Tom Miller and a bipartisan group of state attorneys general have joined the Federal Trade Commission’s administrative complaint challenging a proposed merger between food distribution giants Sysco and US Foods.
Miller says they allege this merger would violate antitrust laws by significantly reducing food distribution competition across the country, and particularly in western Iowa. He says that the result would be higher prices for Iowa consumers who eat away from home, and higher costs for Iowa restaurants, school districts, hospitals and hotels.
Attorneys general from nine states including Iowa, plus the District of Columbia, signed onto the complaint.
The complaint alleges the merger would affect the broadline food distribution industry nationwide, and would significantly reduce competition in 32 local markets, including the Omaha-Council Bluffs market.
Sysco and US Foods offer extensive product lines, including national-brand and private-label food products, and provide frequent and flexible delivery, high levels of customer service, and other value-added services such as order tracking, menu planning, and nutritional information. The two are by far the largest such distributors in the United States.
