Sysco slips on $1 bln stock sale for Jetro Restaurant Depot acquisition

Food distributor Sysco Corp's SYY.N shares were down 2.4% at $81.50 in premarket trading on Tuesday after a $1 billion M&A-related follow-on was priced.

SYY early Tuesday announced about 12.3 million shares at $81, a 3% discount to the stock's last close.

The company, which has about 479.1 million shares outstanding, intends to use net offering proceeds to finance its pending acquisition of Jetro Restaurant Depot.

In March, Houston, Texas-based Sysco said it would buy the catering supplier in a $29 billion deal, comprising $21.6 billion of cash and the balance in stock.

Goldman Sachs and TD Secs are lead bookrunners for the stock offering, along with BofA, JP Morgan and Wells Fargo.

At Monday's close, SYY stock was up about 13% year to date, outpacing an 8% advance in the S&P 500 Consumer Staples sector. The average rating of 17 analysts is "buy"; median price target is $90, per latest LSEG data.