S.E. Rykoff
| Company type | Public |
|---|---|
| Industry | Wholesale food distribution |
| Founded | 1911 in Los Angeles, California, United States |
| Founder | Harry and Ida Rykoff |
| Defunct | 1997 |
| Fate | Merged with JP Foodservice to form US Foodservice |
| Headquarters | Los Angeles (original), later Lisle, Illinois, then Wilkes-Barre, Pennsylvania , United States |
Area served | U.S. West Coast, expanded nationwide |
Key people | Saul E. Rykoff (founder), Roger W. Coleman (CEO 1967–1992), Mark Van Stekelenburg (CEO post-1992) |
| Products | Food products (canned goods, dry groceries, frozen foods), restaurant supplies and equipment |
Number of employees | 1,220 (1975) |
S.E. Rykoff & Co., commonly referred to as SERCO, was a nationwide wholesale food distributor serving primarily restaurants, hotels, and institutional clients along the U.S. West Coast. In 1997, it merged with JP Foodservice to create US Foodservice, which is currently known as US Foods. The company's roots trace back to a modest family grocery store established by Harry and Ida Rykoff in Los Angeles in 1911.
Early history
The Rykoff family relocated from Sioux City, Iowa to Los Angeles in 1910 and soon opened a grocery store near Union Station. After returning from World War I, Saul Rykoff redirected the business toward wholesale distribution of food products in bulk to institutional buyers. Officially incorporated in 1950 under the name of Saul E. Rykoff, the firm focused on supplying canned goods and dry groceries to local Los Angeles restaurants. Saul passed away in 1967, leaving behind his wife Saragrace and three children.
S.E. Rykoff & Co. expansion
In 1967, Roger Coleman, who was Saul’s son-in-law, assumed the roles of president and CEO. By 1969, the company reported profits of $900,000 on revenues of $54 million. Coleman aimed to accelerate growth through acquiring regional wholesale distributors to broaden both sales and distribution networks effectively. That same year, Rykoff purchased S&W Fine Foods based in San Francisco, strengthening its foothold in Northern California.
To support expansion plans and provide liquidity for family shareholders, S.E. Rykoff & Co. went public in 1972 by issuing 400,000 shares on NASDAQ at a $25 par value. At that time, earnings reached $1.9 million on sales totaling $75.9 million. Half of the shares issued were used to reduce debt and boost working capital; the remainder were sold by family members.
Following the IPO, the company acquired several businesses including Louis Enders in Brooklyn (covering New York/New Jersey/Connecticut), Schuss Wholesale Grocery Company in Portland, General Foods’ coffee distribution operations in Southern California and Arizona, Reliable Glassware & Equipment in Los Angeles, and C.L. Chaban Co. in San Francisco—thereby expanding into restaurant supplies and equipment.
Between 1972 and 1974, Rykoff expanded its commission-based sales team from 250 to 300 representatives. In 1974, food products made up 78% of total sales—primarily canned and dried goods sourced from other manufacturers—with a limited range of frozen foods and some proprietary products like syrups and sauces. Paper goods and chemicals accounted for 14%, while glassware and equipment made up the balance.
By 1975, annual revenues reached $163 million with profits of $5.1 million supported by a workforce of 1,220 employees operating throughout California, Alaska, Hawaii, Nevada, Oregon, and on the East Coast through Louis Enders. Under Coleman’s leadership during that decade, sales tripled and earnings increased fivefold.
In 1976, Rykoff announced plans for a new 250,000 square foot distribution facility in the San Francisco Bay Area to replace an older site acquired through C.L. Chaban Co., enhancing service capabilities across Northern and Central California.
The following year, Rykoff expanded into kitchen and restaurant equipment sales on the East Coast by acquiring Boston-based Food Service and Design Corp., entering a higher-margin segment that complemented its core grocery distribution business.
However, due to operational difficulties stemming from distance and labor disputes, Rykoff shuttered its unprofitable New York division (originally Louis Enders) in 1979.
By 1981, although U.S. foodservice industry sales reached $51 billion with no dominant national leader (the largest held only about a 3% market share), S.E. Rykoff & Co., as the leading West Coast distributor, posted $315 million in revenue supported by over 500 commission-based sales personnel. Approximately 65% of sales were generated from house brands; the remainder came from non-food items such as equipment and supplies. CEO Coleman maintained that industry consolidation was improbable given the regional nature of markets.
Acquisition of John Sexton & Co. by S.E. Rykoff & Co.
In 1982, Roger W. Coleman proposed acquiring John Sexton & Co. from Beatrice Foods, which had purchased Sexton in 1968 for $37.5 million. At that point, Sexton reported revenues of $380 million and net earnings of $12 million, exceeding Rykoff's $346 million revenue and $4.5 million net income figures. Coleman identified significant value in Sexton's well-established brand, broad product assortment, nationwide distribution system, manufacturing facilities, and respected sales team. The acquisition was completed in 1983 for $84 million, representing the largest transaction in the foodservice sector at that time. While Rykoff's operations were largely concentrated on the West Coast, Sexton's national footprint since its founding in 1897 provided a substantial strategic benefit. Following the acquisition, Coleman convinced the board to rebrand the company as Rykoff-Sexton, which by 1986 had become the fourth-largest foodservice distributor with $800 million in sales.
Retirement of CEO Roger W. Coleman
After a 42-year tenure at S.E. Rykoff & Co., including 25 years as chief executive officer, Roger W. Coleman retired in December 1992. During his leadership, the company transformed from a family-run West Coast wholesaler into a national wholesale grocer generating over $1 billion annually. Coleman's approach of acquiring regional wholesalers and consolidating them under a unified brand influenced industry practices throughout the mid-1990s. Mark Van Stekelenburg, then serving as executive vice president and board member with previous experience at Royal Ahold NV, succeeded Coleman as CEO at age 41. Subsequently, the corporate headquarters was relocated to Lisle, Illinois.
Expansion through Acquisitions under CEO Mark Van Stekelenburg
Beginning in 1996 under Van Stekelenburg’s leadership, Rykoff-Sexton pursued growth by acquiring Continental Foods (Baltimore, MD), H&O Foods (Las Vegas, NV), and US Foodservice (Wilkes-Barre, PA). The company managed several divisions: a national foodservice distribution arm operating as US Foodservice; a private label manufacturing unit known as Sexton Foods; a contract and design division called Finegolds; and an equipment and supply segment retaining the S.E. Rykoff & Co. name.
By 1997, annual sales reached $3.2 billion as Rykoff-Sexton consolidated its various brands under the US Foodservice banner to enhance national brand recognition amid rapid industry consolidation. This rebranding initiative aimed to strengthen competitiveness against Sysco, the market leader with $14.45 billion in fiscal 1997 revenue. During this period, headquarters moved from Lisle, Illinois to Wilkes-Barre, Pennsylvania to better support its expanding nationwide operations.
Merger of Rykoff-Sexton with JP Foodservice
In July 1997, JP Foodservice ($1.7 billion in revenue) merged with Rykoff-Sexton ($3.2 billion revenue) to create a larger entity positioned to compete effectively within a consolidating foodservice market. JP Foodservice acquired all outstanding shares of Rykoff-Sexton through a stock exchange valued at $680 million and assumed $700 million in debt, resulting in a total transaction value of $1.38 billion. The combined company reported $5 billion in annual sales for 1997 and unified all brands under the US Foodservice name.
The Rykoff-Sexton name continues to hold recognition within US Foods’ product offerings—most notably featured in its coffee catalog—often presented without a hyphen.
Acquisition of US Foodservice by Ahold
In the year 2000, Ahold completed the purchase of US Foodservice, paying $3.6 billion in cash for the transaction.
Divestiture of US Foodservice by Ahold to KKR
In 2007, Ahold divested US Foodservice to the private equity firm KKR. KKR incorporated it into its investment portfolio with intentions to later pursue a public offering on the New York Stock Exchange and to decrease the debt incurred from the acquisition.