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Borden Dairy Approved for Sale to Capitol Peak Partners and KKR

Borden Dairy Approved for Sale to Capitol Peak Partners and KKR


DALLAS, TX
Monday, June 29th, 2020

Borden Dairy is kicking off a new chapter for its business. Last week, the dairy giant announced Capitol Peak Partners and its affiliates have acquired all Borden assets following the completion of a court-supervised sale process, amounting to $340 million.

Tony Sarsam, Chief Executive Officer, Borden Dairy"Borden received strong investor interest and multiple bids throughout this sale process, which is a testament to the terrific work the people of Borden have done to build a valuable and enduring 163-year-old brand," said Borden CEO Tony Sarsam. "Despite being in the midst of Chapter 11 and a global pandemic, our team managed to generate positive cash flow, grow our customer footprint, and maintain an uninterrupted food supply to nourish American families. We are exiting Chapter 11 as a thriving company that is meeting and exceeding its performance forecasts, making our outlook very promising."

As part of the deal, Capitol Peak will assume majority ownership of Borden, which will be appropriately capitalized, according to a press release. The acquisition follows Borden’s voluntary reorganization proceedings on January 5, 2020, to pursue a financial restructuring designed to reduce its debt load, maximize value, and position the dairy behemoth for long-term success.

Capitol Peak Partners and its affiliates have acquired all Borden Dairy assets following the completion of a court-supervised sale process, amounting to $340 million

Following the acquisition, Borden will remain intact, including all plants, branches, routes, the Borden brand, and the employment of its 3,300 employees. However, former controlling and majority equity holders, ACON Investments and Grupo Lala, will no longer have ownership interest in the business, while KKR, an existing lender, will become a minority investor. In the wake of this shift, Capitol Peak and KKR will establish a new Board of Directors.

Gregg Engles, Founder and Managing Partner, Capitol Peak Partners"Borden has a rich history of partnering with America's dairy farmers and leading retailers to provide wholesome nutrition for American consumers and families," said Capitol Peak's Founder and Managing Partner Gregg Engles, who brings extensive dairy industry experience as the former Chairman and CEO of both Dean Foods and WhiteWave Foods. "The Capitol Peak team is excited by this unique opportunity to work alongside KKR and build this iconic dairy company."

The transaction, which is subject to certain closing conditions, including the entry of a final order, is expected to be finalized in mid-July.

How will Borden Dairy’s new ownership strengthen its standing in the dairy category? Deli Market News will continue to report.

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