USA – Industrial Realty Group, a privately-held real estate development and investment firm, has reached an agreement with American dairy giant, Dean Foods to purchase the company’s Meadow Gold Hawaii operations as an ongoing business.
As part of the agreement, which is subject to final approval by the Bankruptcy Court, Industrial Realty Group will acquire the assets, rights, interests, and properties relating to Dean Foods’ Hilo and Honolulu facilities.
If the deal is approved, Industrial Realty Group will be partnering with 8 Cow Dairies, a Hawaii-based company, to manage operations.
Commenting on the arrangement, Eric Beringause, President and CEO of Dean Foods said: “We are pleased to have reached an agreement in principle for our Meadow Gold Hawaii facilities and that Industrial Realty Group intends to continue these facilities on an ongoing basis.
“We are committed to completing this transaction, and our previously announced sales, as quickly as possible, and we thank all of our employees for their continued patience, hard work and dedication.”
The agreement to dispose the assets follows last year’s move by Dean Foods to file for bankruptcy citing challenges in staying afloat in the volatile dairy market.
Dairy Farmers of America will acquire the assets, rights, interests, and properties relating to 44 of the company’s fluid and frozen facilities for US$433 million.
The purchase price is slightly higher than the US$425 million price that DFA and Dean Foods initially announced in February this year and marks significant progress in the deal that nearly tumbled after reports emerged that DFA has terminated the agreement.
Dean Foods was said to have abandoned the agreement with DFA after resistance from creditors and its bankruptcy judge.
DFA later confirmed that it was re-evaluating its options to bid on Dean’s assets by the 30 March deadline. Following a competitive auction process, the company was announced as the winning bidder of Dean’s majority assets.
Prairie Farms Dairy will also be acquiring certain assets, rights, interests, and properties of Dean Food’s relating to eight additional facilities, two distribution branches among other assets.
Mana Saves McArthur and Producers Dairy Foods were also designated as winning bidders for the sale of the facilities located in Miami, Florida and Reno, Nevada, respectively while Harmoni will acquire Dean Food’s Uncle Matt’s business.
However, all agreements are subject to court approval and certain other closing conditions. Subject to Bankruptcy Court approval, the transactions are expected to close at the end of April 2020.