Borden Dairy Co. and Dean Foods Co. bondholders want to merge the two bankrupt dairy companies, proposing an alternative to Dean’s pending merger with a major U.S. dairy cooperative, WSJ Pro Bankruptcy reported. Dean, the top U.S. milk processor by sales, is racing to ease antitrust concerns around its proposed tie-up with cooperative Dairy Farmers of America Inc. and to close their $433 million merger. The Wall Street Journal reported Monday that Justice Department antitrust officials were nearing a settlement with DFA that would let the acquisition move forward. The Borden bid, put forth in Dean’s court-supervised bankruptcy on Thursday, is positioned as an alternative transaction in the event the DFA deal is rejected. DFA won court approval earlier this month to buy the bulk of Dean’s assets out of bankruptcy, subject to clearance from the Justice Department. Antitrust authorities have been examining for months the potential effect of the combination on the price of milk and on competition in the dairy industry. In court papers filed in the U.S. Bankruptcy Court in Houston, Borden said its proposed merger with Dean would “avoid the antitrust concerns” surrounding the DFA merger.
