The U.S. Bankruptcy Court for the Southern District of Texas approved the sale of a substantial portion of Dean Foods’ business operations, providing a path forward for the nation’s largest milk processor during a very tumultuous time for the dairy industry. The sale included 44 of the company’s fluid and frozen facilities to Dairy Farmers of America for $433 million.
The Dallas-based company filed for Chapter 11 bankruptcy on Nov. 12.
In addition, the court on Friday approved several smaller deals including:
- The rights, interests, and properties relating to eight additional facilities, two distribution branches and certain other assets to Prairie Farms Dairy for $75 million in cash;
- The sale of Dean Foods’ facility in Miami, Florida to Mana Saves McArthur, LLC for $16.5 million.
- Producers Dairy Foods’ purchase of Dean Foods’ Reno, Nev., facility for $3.7 million and its purchase of the “Berkeley Farms” trademark and related intellectual property for $3 million.
- The sale of the company’s Uncle Matt’s business to Harmoni Inc. for $7.25 million.
- The sale of Dean Foods’ Meadow Gold Hawaii operations as an ongoing business to Industrial Realty GroupvLLC for $25.5 million.
Two objections were filed during the sales process, one by an ad hoc group of bondholders which sought to reorganize Dean Foods and another by California Dairies Inc.
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The ad hoc group filed an objection on April 1, saying it was still in discussions with private dairymen, cooperatives and others in an effort to propose a restructuring transaction rather than sell assets. But the bondholders later withdrew their objection.
Each transaction remains subject to customary closing conditions, including any required regulatory approvals. The company anticipates completing all transactions by early May.
“Following the competitive court-supervised auction process, and with the court’s approval, we have determined a combination of bids that represent the best path forward for our stakeholders,” Eric Beringause, president and CEO of Dean Foods said in a statement. “We are confident that, under these new owners, our customers can expect the same commitment to quality and service that Dean Foods has lived up to over the years.”
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