CHEF - Chefs' Warehouse could make more international acquisitions - BTIG

The Chefs' Warehouse ( NASDAQ: CHEF ) is being sized up after the acquisition of Gulf-based Chef Middle East from alternative asset management firm Gulf Capital. The acquisition is expected to generate between $160M and $180M in annual sales and $11M to $14M in EBITDA for the company.

BTIG said the deal is a clear signal of the willingness of CHEF to invest outside the U.S.

Analyst Peter Saleh said the firm's conversation with management indicated the company had been in discussions with Chef Middle East for several years, but COVID disruptions put everything on hold. Saleh said CHEF is likely to make more international acquisitions with the company focused on pursuing growth overseas to compliment not replace its domestic growth.

"We don't believe this signals that domestic opportunities have dried up, in fact, our recent conversation actually suggested the opposite. We were surprised by the geography when announced this morning, but we have come around on the rationale as there is a lot of economic development in these countries, greater Western/expatriate influence and a developing culinary scene with many of the same customers."

BTIG reiterated a Buy rating on CHEF price target of $48.

Read more about CHEF's M&A play.

For further details see: