Following last week’s US District Court decision, Sysco Corporation said Monday it has terminated its merger agreement with US Foods.

A US District Court judge granted the Federal Trade Commission’s (FTC) request last week for a preliminary injunction to block the proposed merger between two of the country’s biggest food distribution companies.

Sysco’s break of the merger also terminates an agreement with Performance Food Group (PFG) to purchase US Foods facilities in 11 markets. Under the terms of the agreement, the termination requires Sysco to pay break-up fees of $300 million to US Foods and $12.5 million to PFG.

"After reviewing our options, including whether to appeal the Court's decision, we have concluded that it's in the best interests of all our stakeholders to move on," said Bill DeLaney, Sysco president and CEO. "We believed the merger was the right strategic decision for us, and we are disappointed that it did not come to fruition. However, we are prepared to move forward with initiatives that will contribute to the success of Sysco and our stakeholders.”

FTC filed a complaint to block the merger in February charging the union violated antitrust laws by significantly reducing competition nationwide. The commission alleged that if the merger goes forward as proposed, foodservice customers, including restaurants, hospitals, hotels, and schools, would likely face higher prices and diminished service.

 In 2013, Sysco announced plans to acquire US Foods in a stock-and-cash deal valued at around $3.5 billion. The deal was approved by the board of each company, and expected to close in the third quarter of 2014. Sysco agreed to assume or refinance US Foods debt worth around $4.7 billion. The proposed merger of both food-service distributors projected to have sales of around $65 billion a year.