DALLAS (Bloomberg) — Suiza Foods Corp., the nation's largest dairy producer, completed its $2.8 billion acquisition of Dean Foods Co., a purchase that is expected to increase its sales by 75 percent.
The combined company will be known as Dean Foods and trade under the ticker symbol "DF" beginning Monday. It will be based in Suiza's headquarters in Dallas.
Suiza agreed to repurchase a stake in its dairy unit held by Dairy Farmers of America Inc. and sell 11 plants in eight states, including Utah, to National Dairy Holdings LP to allay government concerns that the combined company would control too much of retail and school-milk sales in those areas. It will have $10 billion in sales and about 35 percent of the U.S. market.
Suiza also replaced it and Dean Foods' credit facilities with a new one that gives the combined company the ability to borrow as much as $2.7 billion. At the time of the acquisition's closing, the company had borrowed about $1.9 billion.
In April, Suiza agreed to pay $21 in cash and 0.429 Suiza share for each Dean Foods share. It will also assume about $1 billion in debt.
National Dairy Holdings is a new partnership half owned by Dairy Farmers of America. Suiza exchanged the 11 dairies, $145 million in cash and a $40 million contingent note to repurchase the 33 percent stake in Suiza Dairy Group that Dairy Farmers held.