US Foods Holding Corp. announced the termination of its merger discussions with Performance Food Group, ending the exploratory process that had been underway since early 2025. The decision follows a detailed assessment of synergies and regulatory hurdles, with the board concluding that pursuing an independent growth strategy will deliver greater long‑term value for shareholders.
In tandem with the merger decision, US Foods entered into a $250 million accelerated share‑repurchase (ASR) agreement under its existing buyback program. The ASR allows the company to retire shares immediately, providing shareholders with a quicker return of capital. The board also approved a new $1 billion share‑repurchase authorization, expanding the company’s ability to buy back stock in future periods as it sees fit.
The move reflects confidence in the company’s operating performance. In Q3 2025, US Foods reported net sales of $10.19 billion, up 4.8% from the prior year, and adjusted EBITDA of $505 million, an 11.0% increase. The growth was driven by a 5.4% rise in adjusted EBITDA margin, a 40‑basis‑point improvement attributed to stronger pricing power in the independent restaurant segment and disciplined cost management.
CEO Dave Flitman said the board’s decision “is in the best interest of US Foods and its shareholders.” He added that the accelerated buyback and new authorization “highlight the confidence we have in our future and our acceleration in operating cash flow.” CFO Dirk Locascio noted that the combination of top‑line growth, margin expansion, and share buybacks contributed to a 28% increase in adjusted diluted EPS, beating the consensus estimate of $1.05 by $0.04.
Investors welcomed the announcement, with analysts upgrading their outlooks, citing the company’s strong cash generation and the strategic clarity gained by abandoning the merger. The announcement also reinforced US Foods’ position as a leading independent distributor, with a market share gain of 0.3 percentage points in the independent restaurant segment during the quarter.
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