The Tribune

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

PRIME Minister Perry Christie said yesterday that the Government’s decision on the potential acquisition of Bahamas Food Services (BFS) by the multi-billion dollar US distribution giant, Sysco, was one that “would not be delayed much longer”.

Speaking with Tribune Business regarding talks on the potential acquisition, Mr Christie said: “It’s in progress, it’s something we have been looking at.

“We have been talking with the wholesalers. The difficulty is, when you had a company that is totally owned by a foreigner and he wants to sell to another foreigner, it’s difficult to find a reason to say you can’t sell in this kind of economy.

“What you can do, is if there is apprehension that the company is so big that it will muscle out other Bahamian companies, governments can control that reality. It’s not a decision that will be delayed much longer. It’s a process that we’re going to go through and make a decision on it.”

Mr Christie confirmed last month that Sysco’s purchase of BFS, as first revealed by Tribune Business, was in the works.

The Texas-based food distribution giant had expressed interest in BFS before in 2004-2005, but the initial deal, which was mulled under the first Christie administration, never came to fruition, partly because the Government was reluctant to grant approval for it in an industry supposedly reserved for 100 per cent Bahamian ownership only.

Sysco boasts of sales and service relationships with about 400,000 customers, operating from more than 180 locations throughout the US, Canada and Ireland.

BFS, formerly known as Island Seafood (ISF), has been operating in the Bahamas since 1971. The company, which employs some 300 Bahamians and offers more than 9,000 product lines, is owned by the Frisch family out of Jacksonville, Florida. The same family controls the parent, Beaver Street Fisheries.

BFS operates from a 160,000 square foot facility, located on 20 acres, off Gladstone Road. It has room for expansion, and also has its Tropic Seafood fisheries export arm. It is also the leading food supplier to the Bahamian hotel, restaurant and retail industry.

The potential arrival of Sysco could prove challenging for Bahamian wholesale industry rivals, who fear Sysco’s market power could pose a competitive threat that drives them out of business.

Patrick Treco, managing director of Continental Foods, previously told this newspaper that if a deal between Sysco and BFS were to happen, it could be detrimental to rival Bahamian wholesalers who would be “undercut” on price.

But Phil Lightbourne, head of Phil’s Food Services, has backed any takeover by Sysco, a New York Stock Exchange (NYSE) listed company with $37 billion in annual sales.

He said it would benefit both Bahamian consumers and small food retailers. Suggesting that only BFS, with the backing of someone like Sysco, would be able to meet the demands of both Atlantis and Baha Mar when the latter opened, Mr Lightbourne said Sysco’s product offering and purchasing power would reduce prices in the Bahamas.

And he added that Sysco was also prepared to offer Bahamians shares via a Bahamian Depository Receipt (BDR) offering.