Danone To Sell Stonyfield Unit In Deal With DOJ To Fulfill WhiteWave Acquisition

(RTTNews) - French dairy giant Danone (DANOY.PK), which is in deal to acquire Consumer packaged food and beverage company WhiteWave Foods Co. (WWAV), announced Friday that the companies have reached a major step towards the completion of the planned merger as it has reached an agreement in principle with the Antitrust Division of the United States Department of Justice.

As part of the agreement in principle, in order to facilitate the prompt closing of the WhiteWave acquisition, Danone has decided to sell one of its U.S. dairy subsidiaries, Stonyfield, in the months following the closing of the acquisition of WhiteWave. This move is expected to permit closing to occur shortly and will allow the company to proceed at the soonest with the integration and reap the full benefits of the announced synergies.

While Stonyfield has been a valued part of Danone's portfolio and remains a highly attractive asset, its divestiture does not impact the strategic rationale or financial benefits of the WhiteWave acquisition. Stonyfield generated approximately $370 million in turnover in 2016.

It was in July last year that Danone agreed to buy US-based WhiteWave for $56.25 per share in an all-cash transaction. The total enterprise value of the deal would be approximately $12.5 billion.

Emmanuel FABER, Chief Executive Officer of Danone, said: "As part of the agreement in principle with the DOJ, we made the strategic decision to divest Stonyfield as it allows us to take a major step towards completing the WhiteWave transaction expeditiously. This is a good outcome as it addresses the DOJ's concerns and enables Danone to shortly begin to capture the benefits of the combination, and the value creation announced last July."

Separately, WhiteWave Foods said it expects the closing of merger transaction to occur shortly, although there can be no assurance regarding timing of completion of regulatory processes.