The $60 million will be used to reduce outstanding debt at Broomfield-based WhiteWave (NYSE: WWAV) and to focus on strategic growth plans, said Gregg Engles, chairman and chief executive of the company. Engles also is chairman of Dallas-based Dean Foods (NYSE: DF).
Dean Foods said it would sell the Morningstar Foods dairy and cultured-products division for $1.45 billion to Montreal-based dairy company Saputo (TSX: SAP). Dean Foods expects to see $887 million in proceeds from the sale, the company said.
WhiteWave raised $391 million in an initial public offering in October, but Dean Foods continues to own 86.7 percent of the company’s stock and retains 98.5 percent of voting power. WhiteWave produces Silk soy milk products, Horizon Organic milk, International Delight coffee creamers and Land O’Lakes dairy products.
“WhiteWave is pleased to continue its relationship with Morningstar, which will soon become part of the Saputo organization,” Engles said in the press statement.
The money WhiteWave will receive is for an agreement to end an option WhiteWave has to buy plant capacity and property at a Morningstar processing plant in Frederick, Maryland, according to the press statement. WhiteWave also has agreed to sell some of its manufacturing equipment already located at a Morningstar plant in Sulphur Springs, Texas.
At the same time, WhiteWave and Morningstar will continue an existing commercial relationship in which Morningstar manufactures products for WhiteWave, according to the press statement. The sale is not expected to change the economic terms of WhiteWave’s existing co-packing agreement with Morningstar, according to the press statement.
WhiteWave’s existing business relationship with Saputo Inc. also will continue, according to the press statement. Saputo manufactures and sells WhiteWave products in Canada.
Boulder entrepreneur Steve Demos founded WhiteWave in Boulder in 1977. Dean Foods acquired the company in 2002. WhiteWave has 1,727 employees, 465 of them in Broomfield, according to Molly Keveney, a company spokeswoman.