Dean Foods and DFA in asset agreement
US-based Dean Foods Company says that it and certain of its subsidiaries have entered into an asset purchase agreement with Dairy Farmers of America through which DFA will acquire a substantial portion of Dean Foods’ business operations. Pursuant to the agreement, if consummated, DFA will acquire 44 of the company’s fluid and frozen facilities and the real estate, inventory, equipment, and all other assets necessary to operate such facilities.
“We have had a relationship with DFA over the past 20 years, and we are confident in their ability to succeed in the current market and serve our customers with the same commitment to quality and service they have come to expect,” said Eric Beringause, president and chief executive officer of Dean Foods.
Beringause continued, “I would like to thank all Dean Foods employees for their continued commitment to our customers, our partners and our company throughout this process. Their efforts have enabled us to continue providing an uninterrupted supply of high-quality dairy products, as well as support our dairy suppliers, vendors and other partners as we work to determine the best path forward for our business.”
If approved by the bankruptcy court at a hearing scheduled for 12 March, DFA will serve as a “stalking horse bidder” for the assets in a court-supervised sales process, whereby the agreement with DFA will set the floor for the sale of the assets. Accordingly, the proposed agreement is subject to higher or otherwise better offers, and the company looks forward to working with its bondholders and other potentially interested parties in connection with their bids.
The deadline for interested parties to furnish information to be considered a potential bidder for any or all of the assets is currently scheduled for 31 March. Bids may be submitted in the form of an asset purchase or a plan of reorganisation. The company is also in active discussions with parties interested in the plants and assets that are not included in the DFA bid. The deadline to furnish information to be considered a potential bidder for the plants and assets that are not subject to the DFA bid is also currently scheduled for 31 March.