NEW YORK (Reuters) - Dean Foods Co (DF.N) is seeking a buyer for its Morningstar dairy division, which is expected to fetch more than $1 billion in a sale, according to several people familiar with the matter.
The U.S. food and beverage producer has hired investment bank Evercore Partners Inc (EVR.N) to shop the business to potential buyers and has attracted interest mostly from private equity firms, two of the people said.
Morningstar, the smallest of Dean Foods’ three segments, sells Friendship cottage cheese and private label dairy products such as creamers, ice cream mix and sour cream. It supplies a range of foodservice customers such as restaurant chains.
The private label business has lower margins than the company’s branded products, which include Silk soy milk, Horizon Organic dairy products and International Delight coffee creamer products.
The people asked not to be named because the matter is not public. Representatives for Dean Foods declined to comment while Evercore did not immediately return calls seeking comment.
Reporting by Soyoung Kim in New York, additional reporting by Martinne Geller; Editing by Gerald E. McCormick