Saputo Inc will buy Dean Foods Co's (DF.N) Morningstar division for $1.45 billion to widen its product range and increase its U.S. presence, the Canadian dairy products maker said on Monday.
The sale of Morningstar, which makes coffee creamers, Friendship cottage cheese and other dairy products, will be a big step in the breakup of Dean, which is spinning off another business into WhiteWave Foods Co (WWAV.N).
After the sale of Morningstar and the separation of WhiteWave, which sells Silk soy milk and Horizon organic milk, Dallas-based Dean will sell mostly regular milk, which is a difficult business with declining sales volumes, volatile commodity costs and slim margins due to intense price competition from store brands.
Montreal-based Saputo, which has expanded its U.S. cheese business with several smaller acquisitions, is getting Morningstar at an attractive price, analysts said.
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