Private equity-backed milk processor Golden Guernsey Dairy LLC filed for bankruptcy and said that it will liquidate after it failed to cut operating costs, Reuters reported yesterday. The company, backed by Los Angeles-based firm OpenGate Capital LLC, filed for chapter 7 bankruptcy protection on Tuesday. OpenGate bought Wisconsin-based Guernsey Dairy from Dean Foods Co. in September 2011 to resolve anti-trust concerns about Dean Foods' large share of school milk supplies in the state. The private equity firm said that it increased sales by 20 percent after it bought Golden Guernsey from Dean Foods but was unable to reduce costs in a meaningful manner, given some of its legacy relationships. Golden Guernsey, an 83-year-old company, supplies milk and milk products to schools, grocery stores and retailers in Wisconsin, Illinois, Minnesota and Iowa.
