Bureau Resolves Competition Concerns in Sysco-Serca Merger: Serca Agrees to Sell B.C. Food Service Assets to Competitor

OTTAWA, March 21, 2002 - The Competition Bureau announced today that the merger of Sysco Corporation and Serca Foodservice Inc. can proceed given the announcement on March 19, 2002, that Serca's assets in British Columbia will be sold to Gordon Food Service Inc. All three companies are engaged in the supply of food and restaurant supplies to hospitals, schools, restaurants and hotels.

"Protecting competition in the food service industry is of vital importance to all consumers," said Robert Lancop, Assistant Deputy Commissioner of Competition. "The sale of Serca's B.C. assets to Gordon Food Service effectively creates a second national presence in food service distribution while addressing our competition concerns in B.C."

Sysco Corporation announced its intention to acquire the assets of Serca Foodservice Inc. and other related food service assets from Sobeys Inc. across Canada on December 5, 2001. At the time of the announcement, Sysco Corporation and Serca Foodservice Inc. were the two largest food service distributors in British Columbia. Sysco Corporation is North America's largest food service distributor.

"Our goal is to promote and maintain competition so Canadians can benefit from lower prices, product choice and quality services," said Robert Lancop, "Resolving competition problems up front before closing is the best way to go because it avoids time-consuming negotiations and the potential for costly litigation. This 'fix-it first' solution benefits the parties, food service operators, consumers and Canadian taxpayers."

After a thorough review, the Bureau concluded that the Sysco purchase of Serca would likely result in a substantial lessening of competition in British Columbia's food service industry. The merger did not raise competition concerns outside of British Columbia.

The Competition Bureau is an independent law enforcement agency that promotes and maintains fair competition so that all Canadians can benefit from competitive prices, product choice and quality service. It oversees the application of the Competition Act, the Consumer Packaging and Labelling Act, the Textile Labelling Act and the Precious Metals Marking Act.

For general public enquiries, please contact:
Competition Bureau's Information Centre
1-800-348-5358 or (819) 997-4282

For media enquiries, please contact:
Tim Weil
Senior Communications Advisor
Communications Branch
(819) 953-9271 or (613) 296-2189 (cell.)