The transaction is expected to close at the end of April 2020, subject to obtaining clearance from the Canadian Competition Bureau.
The sale of Summit follows the consolidation of Colabor’s Ontario distribution activities into a Mississauga, Ont., distribution centre which was announced earlier in January.
“The sale of this division will allow us to refocus our business while improving operating profitability, strengthening our financial situation and providing the necessary resources and bandwidth to focus on our value-added markets,” Louis Frenette, president and CEO of Colabor, said in a press release. “After years of operating Summit in a challenging environment, this is the final important step of our optimization plan for our Ontario operations.”
“Summit is a well-respected distributor with a strong track record of providing superior service, value and integrity which complements the Flanagan culture and our own commitment to quality,” said Dan Flanagan, CEO of Flanagan. “As one company, we will use our scale to enhance service to our customers and continue to offer them the difference they deserve.”
The transaction includes the Summit Mississauga distribution centre and related equipment, the Street and System business and a majority of the employment contracts. Flanagan Foodservice will also become the exclusive distributor of Colabor’s Menu brand in Ontario.
Flanagan Foodservice is the largest Canadian and family-owned foodservice distributor in the country. The company was founded in 1977.
Colabor is a distributor and wholesaler of food and related products serving the hotel, restaurant and institutional markets in Quebec, Ontario and in the Atlantic provinces, as well as the retail market.