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Let’s TalkFerraro Foods Acquires GDS Foods in New Jersey
Ferraro Foods, a food supplier for independent pizzerias and Italian restaurants, acquired GDS Foods, a foodservice distributor catering to pizzerias and restaurants, on June 16, 2023. Both companies are based in New Jersey, United States. The acquisition expands Ferraro’s network of distribution centers, adds customers, and broadens its offering.
Transaction Summary
The Facts of the Acquisition
- Target: GDS Foods is a family-owned foodservice distributor. It distributes to restaurants and pizzerias in the tri-state area of New York, New Jersey, and Connecticut. It has one distribution center in Sussex, New Jersey.
- Acquirer: Ferraro Foods is a distributor servicing pizzerias and Italian restaurants. It is backed by private equity firm Kelso Private Equity. Ferraro distributes in 23 states through seven distribution centers.
Our Take on the Acquisition
It is not immediately clear why Ferraro Foods (acquirer) bought GDS Foods (target). Ferraro has a distribution center in New Jersey, 50 miles from the target’s distribution center. Additionally, Ferraro is building a 230,000 square-foot warehouse and distribution center in Edgewood, New York, to increase its share of the world’s largest and most concentrated local pizza market. It is expected the distribution center will be operational later in 2023.
The Transaction
| Date: | June 16, 2023 |
| Price: | Undisclosed |
| Purpose: | To expand distribution capacity in the Northeast United States |
| Acquirer’s Statement: | Dan Hill, CEO of Ferraro Foods – “We are excited to partner with GDS, a terrific family-run business with strong roots in the area going back 35 years. We love the business, we love the people, and they have a loyal customer base that aligns perfectly with Ferraro’s. Just as important, GDS is pizza to the core, so they are a perfect fit for the Ferraro culture.” |
Target/Seller: GDS Foods Inc.
Company Information
| Target: | GDS Foods Inc. |
| Website: | gdsfoods.com |
| Founded: | 1986 |
| Industry: | Food and Beverage Distributor |
| Type: | Private, family owned |
| Employees: | 17 (Self-published on LinkedIn) |
| Locations: | Head Office and Distribution Center: 148 Compton Road, Sussex, New Jersey, United States (50 miles from the acquirer’s distribution center) |
Product Information
| Services: | Distribution – Sourcing food items from producers and selling to businesses and retail customers Logistics – Transportation of food items to retail and wholesale buyers Warehousing – Storage and handling of food items. Packing to meet order size |
| Market Reach: | Connecticut, United States New Jersey, United States New York, United States |
Financial Information
| Revenue: | USD $5.6 million (Unconfirmed Source: ZoomInfo) |
| Revenue per Employee: | USD $329,412 (i.e., USD $5.6 million / 17 employees = USD $329,412 – estimated based on the self-published number of employees and the revenue from ZoomInfo) |
Did You Know?
In 2022 there were 44,644 independent pizzerias in the United States, up from 39,808 in 2021 and an increase of 12.15%. Pizzeria chains – Domino’s, Papa John’s, and so on – however, saw relatively no growth, 0.63%, from 35,309 in 2021 to 35,531 in 2022. The United States is considered one of the most saturated markets for pizzerias, and total sales from pizzerias in the United States is USD $46.99 billion.
Target/Seller Overview: GDS Foods Inc.
GDS has been distributing food products to restaurants and pizzerias in the tri-state area of New York, New Jersey, and Connecticut. The company services clients through its distribution center in Sussex, New Jersey. It has been family owned and strives for a culture of offering value to customers with high-quality products and services.
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Explore Your Options NowBuyer/Acquirer: Ferraro Foods
Company Information
| Buyer: | Ferraro Foods |
| Website: | ferrarofoods.com |
| Founded: | 1975 |
| Industry: | Food Service Distribution |
| Type: | Private with private equity funding |
| Employees: | 270 (Self-published on LinkedIn) |
| Investors: | Canada Pension Plan Investment Board: Investment of the national Canada Pension Plan with a mandate to provide for 21 million Canadians in retirement, disability, and survivor benefits. Kelso Private Equity: A North American-focused private equity firm with USD $15 billion in total investments since 1980. |
| Locations: | Head Office and Distribution Center #1: 287 S Randolphville Rd, Piscataway, New Jersey, United States (50 miles from the target’s distribution center) Connecticut Distribution Center #2: 10 Knotter Dr, Cheshire, Connecticut, United States Florida Distribution Center #3: 5437 SW 1st Ln, Ocala, Florida, United States Indiana 3rd Party Distribution Center #1: 5000 Anson Blvd. Whitestown, Indiana, United States Maryland Distribution Center #4: 1501 Perryman Road, Aberdeen, Maryland, United States New York Distribution Center #5: 5 Park Dr, Melville, New York, United States North Carolina Distribution Center #6: 2031 Park Center Dr, Mebane, North Carolina, United States |
Product Information
| Services: | Distribution – Sourcing food items from producers and selling to businesses and retail customers Logistics – Transportation of food items to retail and wholesale buyers Warehousing – Storage and handling of food items. Packing to meet order size |
| Market Reach: | Connecticut Delaware Florida Georgia Illinois Indiana Kentucky Maine Maryland Massachusetts Missouri New Hampshire New Jersey New York North Carolina Ohio Pennsylvania Rhode Island South Carolina Tennessee Vermont Virginia West Virginia |
Financial Information
| Revenue: | USD $53.4 million (Unconfirmed Source: ZoomInfo) |
| Revenue per Employee: | USD $197,778 (i.e., USD $53.4 million / 270 employees = USD $197,778 – estimated based on the self-published number of employees and the revenue from ZoomInfo) |
Buyer/Acquirer Overview: Ferraro Foods
Established in 1975 in Green Brook, New Jersey, Ferraro Foods operated out of a small garage and with a single truck. Today, Ferraro is recognized by local pizzerias/trattorias as the most dependable and service-oriented distributor in the marketplace. Ferraro has expanded to serve 8,000 customers throughout the Eastern United States, with a presence in 23 states. The company transports not only products designated for the Italian trade but also over 14,000 items that cater to casual dining establishments. It offers 25+ exclusive brands in categories such as cheese, specialty meats, prepared appetizers, Italian products, seafood, and non-foods.
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Sources
- Company Profile
- Other Sources
- Unconfirmed Sources