Food distributor U.S. Foods went public on Thursday in a billion dollar deal. It was the second largest initial public offering this year. Bobbi Rebell reports.
U.S. Foods making its debut on the New York Stock Exchange Thursday. The billion dollar offering is this year's second-largest IPO, behind MGM Growth Properties. The food distributor's debut is also significant because it is owned by two private equity firms-Clayton Dubilier and Rice, and KKR that had tried and failed to sell the company. Proceeds from the deal will be used to pay down roughly $5 billion in debt. It is the first major leveraged buyout going public since stock market jitters put such debt-heavy offerings on ice at the end of last year. Reuters' Lauren Hirsch: SOUNDBITE: LAUREN HIRSCH, CORRESPONDENT, REUTERS (ENGLISH) SAYING: "Last year, we saw three very high profile leveraged IPOs either delay or downsize their IPOs. That would be Neiman Marcus or Albertson's, who have both delayed, and First Data, which downsized. So for US Foods to get out and to price within range, and then trade up on the first day, that is a sign that investors are willing to accept indebted companies into the public market." Last year's plan to sell U.S. Foods to rival Sysco was blocked by regulators.