Diary Farmers of America has agreed to buy the country’s largest milk producer for $425 million.
In a statement, DFA said the two parties had been negotiating since it became aware of Dean’s plan to file voluntary Chapter 11 reorganization proceedings.
Dean Foods filed for bankruptcy protection in November, blaming a drop in milk consumption and a rise in alternative products like almond or soy milk as contributors to the decline in sales.
The company employs about 16,000 people and operates 60 processing facilities across the country.
Before the sale is finalized, the bankruptcy court overseeing Dean’s case and the U.S. Department of Justice still have to approve of the deal.
Diary Farmers of America Chief Executive Officer and President Rick Smith said the move should help protect the milk industry.
“As Dean Foods is the largest dairy processor in the country and significant customer of DFA, it is important to ensure continued secure markets for our members’ milk and minimal disruption to the U.S. diary industry,” he said.
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