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Sysco's New Subsidiary Wins $49 Million in Pentagon Contracts

By Rich Smith – Jan 9, 2014 at 10:01PM

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US Foods will provide chow to military bases in California and South Korea.

The Department of Defense awarded 10 new defense contracts Thursday, worth $1.094 billion in total. US Foods Inc, currently in the process of being acquired by Sysco (SYY -0.33%), won two of them:

  • A contract modification worth up to $42.2 million, exercising the fourth and final one-year-long option period on a preexisting fixed-price with economic-price-adjustment, indefinite-delivery/indefinite-quantity contract for "prime vendor full-line food distribution." US Foods will be supplying foodstuffs to U.S. Army, Navy, Air Force, and Marine Corps locations, to federal civilian agencies, and to other authorized Department of Defense customers in California and South Korea through Jan. 31, 2015.
  • A separate sole-source, firm-fixed-price, indefinite-quantity contract for prime vendor full-line food distribution in California only. This second contract will be worth up to $7.2 million, and will run through July 12, 2014. Under it, US Foods will supply foodstuffs to U.S. Army, Navy, Air Force, Marine Corps, and Coast Guard locations.

Fool contributor Rich Smith has no position in any stocks mentioned. The Motley Fool recommends Sysco. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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