Metcash Limited → SFG Group Holdings Pty Ltd (Superior Food Group)
completedMetcash entered a binding agreement on 5 February 2024 to acquire 100% of SFG Group Holdings Pty Ltd (trading as Superior Food Group), a private foodservice distributor with around 600 suppliers and 23 branches across Australia, from Quadrant Private Equity and other shareholders. Total consideration was up to approximately A$412.3 million, comprising A$390 million upfront plus an earn-out of up to A$22.3 million tied to FY24 EBITDA. The acquisition was announced alongside two smaller food acquisitions and a linked equity raising, and completed in mid-2024.
Metcash used the deal to materially expand its Food pillar into foodservice and convenience distribution, a category adjacent to but distinct from its core supermarket wholesaling business, adding over A$1.3 billion of extra sales/volume demand and diversifying earnings away from its traditional grocery and hardware wholesale operations. Superior Foods was subsequently merged with Metcash's existing Campbells Wholesale business to form a new Foodservice & Convenience division.
Quadrant Private Equity, which had owned Superior Food Group, used the sale as an exit from its investment after growing the business, realising value from a trade buyer with complementary distribution infrastructure.
Metcash shares were broadly stable to modestly positive on the announcement, with the market viewing the acquisition, funded partly via an equity raising, as a sensible diversification move; longer-term analyst sentiment on Metcash since has been mixed, citing slower core grocery/hardware growth even as Foodservice & Convenience earnings have grown strongly.
Press coverage described the acquisition as part of a "$558.5 million" package of strategic acquisitions Metcash announced in February 2024 (Superior Food Group plus two smaller food businesses), positioning Metcash to accelerate growth in foodservice and convenience as a hedge against structurally slower growth in traditional grocery and hardware wholesaling.
Deal mechanics
Barrenjoey Capital Partners (financial advisor); Herbert Smith Freehills, led by Andrew Rich (legal advisor) to Metcash
Gilbert + Tobin, led by Charles Coorey (legal advisor) to Quadrant Private Equity
Cash acquisition of 100% of SFG Group Holdings' share capital: A$390 million upfront consideration plus an earn-out of up to A$22.3 million based on Superior Food's EBITDA for the year ended 30 June 2024, subject to customary purchase price adjustments. Funded in part via a linked equity raising alongside two other smaller acquisitions.
Subject to ACCC informal merger clearance; the ACCC's public register confirms review of the Metcash Trading Limited / SFG Group Holdings transaction. Completion occurred in the first quarter of Metcash's FY25 (around mid-2024).
Learn more
- Metcash Limited entered into binding agreement to acquire Superior Food Group Pty Ltd for approximately AUD 410 million
- 5 February 2024 ASX Announcement – Strategic Acquisitions and Equity Raising
- Metcash enters into $558.5 million acquisition agreements
- How Investors Are Reacting To Metcash (ASX:MTS) Expanding Into Food Service With Superior Foods Acquisition