The Federal Trade Commission has blinked.
The regulator was close Wednesday night to voting to block a $3.5 billion food industry merger — but postponed the decision after an intense day of meetings with Sysco, The Post has learned.
Sysco, the No. 1 distributor of food to schools, hospitals and restaurants, is looking to gain FTC approval of its deal to buy the No. 2 distributor, US Foods, amid an outcry that the combined company will yield too much power and will inevitably lead to higher prices.
Sysco is desperately trying to convince the FTC’s five commissioners that cost savings from the merger will allow it to lower prices.
At the same time, it has doubled the amount of assets it will sell to the No. 3 food distributor, Performance Food Group, in an effort to win over the FTC.
The effort appeared to be failing as Wednesday’s 6 p.m. FTC meeting neared. The board was leaning toward suing to block the deal, sources said.
Sysco has told commissioners it is willing to consider “additional flexibility” on providing a remedy, another source said.
That effort seems to have pushed the FTC at least into further thought on the offer as the vote was put off.
“It’s a very high-stakes game,” a source said. “Both sides have tough choices.
“My guess is litigation is still the most likely outcome.”
So far, Sysco has offered to sell 11 US Foods facilities — with annual sales of $4.6 billion, or 21 percent of US Foods’ revenue — to Blackstone’s PFG.
The FTC wants Sysco to divest assets that generate up to an additional $2 billion in revenue.
PFG is interested in buying the additional assets, but Sysco is concerned that it might be more than it wants to sell, said another source.
“Sysco is worried about dismantling what they have,” the source said.
Including the debt Sysco would assume in the proposed acquisition, the deal is worth $8.2 billion.
Keith Goldberg, owner of Clinton Hill, Brooklyn’s Baguetteaboudit cafe, said he hopes the merger does not go through, and has had enough of Sysco.
“They almost ruined me,” he said, when opening his cafe four years ago.
He said Sysco looked at his menu and started delivering and billing him for much more food than he needed, like a giant amount of ketchup.
“I don’t even sell burgers or hot dogs.”
Still, he said Sysco and US Foods are the only food distributors that can offer him the variety of foods he needs.
Goldberg canceled his Sysco contract, and now says that, like many other small restaurant owners, he drives to a restaurant supply retailer, Jetro Cash & Carry, for many of his supplies.
Sysco since has opened an Islip, Long Island, facility and is now offering improved service across metro New York, including Brooklyn, a spokesman says.
Sysco and the FTC declined comment on the vote.