ID NEWS: Analysts see major goodwill write-downs for USF

Royal Ahold, Zaandam, The Netherlands, could face up to 2 billion euros of goodwill write-downs at its broadliner subsidiary, U.S. Foodservice, Columbia, MD, according to analysts cited by Reuters. The write-downs will reflect the value of the national distributor after overstated profits of $880 million are taken into account.

While the write-downs are expected to force Ahold to accelerate asset sales, they are unlikely to impact a credit line of 3.1 billion euros. The international grocer and foodservice distribution company must meet reporting deadlines and keep cash earnings at above 2.5 times its interest costs in order to retain the bank standby facility.

Ahold bought USF for $3.6 billion in April 2000, PYA/Monarch, Columbia, SC, for $1.57 billion cash in December 2000, and Alliant Exchange, Deerfield, IL, for $2.2 billion in November 2001. USF also acquired other, smaller though substantial broadliners during the last two years.

Late last week, Ahold announced first quarter results, in which USF was down in sales a less-than-expected 1.5%, for a total of $5.3 billion in business for the 16-week period ended April 20. (See upcoming ID Management Report, 5/2/03).

Members help make our journalism possible. Become a Restaurant Business member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.

Multimedia

Exclusive Content

Financing

For Starbucks, 2 years of change hasn't yielded promised results

The Bottom Line: The coffee shop giant’s sales struggles worsened earlier this year, despite a flurry of efforts to improve operations and employee satisfaction.

Food

Nando's Americanizes its menu a bit as U.S. expansion continues

Behind the Menu: Favorites like mac and cheese, bowls and salads join the fast casual’s Afro-Portuguese-rooted dishes, including the signature peri-peri chicken.

Financing

The consumer is cutting back, but not everywhere

The Bottom Line: Early earnings from major restaurant chains suggest the consumer has taken a distinct turn for the worse so far in 2024.

Trending

More from our partners