Wal-Mart Stores Inc said it will build a dairy processing plant in Indiana to supply private-label milk to about 600 stores, curtailing business with some suppliers in the retailer's sole foray into food processing in the United States.
The move – announced by Wal-Mart on Friday, March 18, but not widely reported by media until Tuesday – helped spark a 12 percent slide in shares of Dean Foods Co, one of the suppliers of milk to the affected stores.
In a securities filing on Tuesday, Dean Foods said the change by Wal-Mart could lead to the loss of 100 million gallons of "very low-margin private-label fluid milk volume" from late 2017. It said it did not expect any impact on the supply of its own national brands and would not be material on its results.
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