Consumer-focused investment firm Capitol Peak Partners LLC and KKR & Co. won a bankruptcy auction for Borden Dairy Co., the milk producer known for its “spokes-cow” Elsie, WSJ Pro Bankruptcy reported. A joint venture between Capitol Peak and KKR was named the winning bidder after an auction to sell Borden’s assets out of bankruptcy, according to the people and to court documents. Capitol Peak is led by Gregg Engles, a former chairman and chief executive of Dean Foods Co., a longtime rival to Borden. KKR is a major lender to Borden, which filed for bankruptcy in January amid falling milk consumption in the U.S., rising freight costs and the growing clout of retailers consolidating with other merchants or beginning to develop their own milk-processing operations. Borden named Prairie Farms Dairy as a backup bidder behind the Capitol Peak-KKR venture, according to court records. Any sale requires approval from the U.S. Bankruptcy Court in Wilmington Del. Borden tried unsuccessfully to merge with Dean in April, before Dean’s assets were purchased out of bankruptcy by Dairy Farmers of America Inc., the nation’s largest dairy cooperative by membership.
