US Foods Holding Corp. USFD
Sachem Head owns 8.7% of US Foods and is running a proxy fight to install five directors who can close the Sysco margin gap and deliver ~100% upside.
Thesis
Sachem Head owns roughly 8.7% of US Foods (~$750M) and is soliciting votes on the GOLD proxy card to seat five nominees — including founder Scott Ferguson and former UPS COO James Barber — after seven months of fruitless settlement talks. Since the 2018 analyst day, USFD has missed guidance repeatedly, churned through four Chief Supply Chain Officers, and now trades at ~11x CY2024 EPS versus Sysco's ~17x — a ~50% multiple gap that has widened post-COVID. Management has acknowledged a 200bp domestic margin gap versus Sysco and previously suggested ~75% was closeable; Sachem Head believes even 50% closure unlocks ~$300M of EBITDA and a clear path to $4+ EPS. Combined with capital-allocation missteps (SGA at ~19x, dilutive KKR preferred for Smart Foodservice), the thesis argues a refreshed board can drive a cultural reset worth ~100% stock upside.
SCQA
US Foods is the #2 US broadline food distributor, publicly listed since 2016 and held by Sachem Head at ~8.7% since 2018, yet chronically trails peer Sysco on margins, TSR, and investor credibility.
Since missing 2018 guidance, USFD has burned through four supply-chain chiefs, botched capital allocation on SGA and Smart Foodservice (KKR preferred dilution), and widened rather than closed a 200bp margin gap versus Sysco — a board oversight failure.
Vote the GOLD proxy card to elect five Sachem Head nominees — Barber, Ferguson, Finard, Harris, Toy — who will reset the culture, elevate supply chain, close the margin gap, and restore guidance credibility.
Closing ~50% of the Sysco margin gap delivers ~$300M EBITDA upside and a path to $4+ EPS, implying ~100% stock upside as USFD's multiple re-rates toward peers.
The three reasons
- 1
USFD trades at ~11x CY2024 EPS vs. Sysco's ~17x — a 50% multiple discount that widened post-COVID
- 2
Four Chief Supply Chain Officers since the 2016 IPO signal board-level oversight failure
- 3
Closing ~50% of the Sysco margin gap unlocks $300M EBITDA and ~100% stock upside
Primary demands
- Elect Sachem Head's five director nominees on the GOLD proxy card
- Refresh the Board to install directors who will hold management accountable
- Drive a cultural reset that gives supply chain equal weight to the sales organization
- Close ~50% of the 200bps margin gap versus Sysco to unlock ~$300M EBITDA upside
- Restore credibility by setting achievable guidance and stopping value-destructive M&A
KPIs cited
Pattern membership
Where this document fits across the library's 12 rhetorical / structural patterns.
Notable slides (2)
Notes
Proxy-fight letter to US Foods stockholders signed by Scott Ferguson (Sachem Head founder, ex-Pershing Square). Filename prefix '2012-10' is misleading — the document itself is dated April 26, 2022 and filed as EX.1 to DFAN14A. Nominees: James J. Barber Jr. (former UPS COO), Scott D. Ferguson, Jeri B. Finard (ex-Godiva/Kraft), John J. Harris (ex-Nestlé Waters), David A. Toy (CEO Heartisan Foods). The letter blames 'the Board' and 'management' collectively without naming the CEO, so villain_named set to false despite adversarial tone. CEO-quote contradiction is the quoted admission 'we recognize that we did not deliver on expectations we set in the past' (company letter 4/18/2022). Explicit grievance over KKR preferred issuance tied to Smart Foodservice deal and the 2018 SGA acquisition at ~19x. No explicit analogue precedents cited.