Danone splashes $12.5bn on organic producer WhiteWave Foods

The French dairy giant has splashed out to buy US organic foods producer WhiteWave Foods.

The all-cash transaction will allow Danone to double its business in the US. Picture: Jim Trifyllis.

French dairy giant Danone said on Thursday it had reached a deal to buy US organic foods producer WhiteWave Foods in an operation that values the US company at $US12.5 billion ($16.59bn).

The all-cash transaction will allow Danone to double its business in the US, the French group said in a statement, adding it expected to finalise the deal by the end of the year.

Danone said it had offered to pay $US56.25 per share “representing a total enterprise value of approximately $US12.5bn.” The deal, which is expected to produce synergies of $300 million by 2020, has been approved by the boards of both companies but has yet to be endorsed by WhiteWave’s shareholders and by competition authorities.

WhiteWave produces a range of organic dairy products and plant-based dairy alternatives, achieving sales of $US4bn in 2015 with such brands as Silk milk and Earthbound Farm organic salad.

Danone CEO Emmanuel Faber said the deal “positions us better to address tomorrow’s consumer trends... and to accelerate our path towards strong sustainable and profitable growth by 2020.”

AFP