Dean Foods Co. (fka DFODQ)

[TuMaRu]

While it seems like DFA plans to absorb all of Deans liabilities, not sure thats a $2.5 B offer. To put it in context, Saputo looked at Deans books last May. Dean apparently wanted 18-20 mil per plant which would put the price at 66 x 20 = $1.32 B plus another ~80 mil for equipment, trucks etc. i.e. at least $1.4 B *AND* assumption of 700-800 mil debts.

Saputo would need to pay >$2.1 B so they passed probably. Problem is that Dean was trading at $3-4 at that time, and not in a position to command "normal" valuation due to many prior missteps. Most analysts pegged Deans enterprise value at 300-500 million, not $2+ billion -- poorly maintained plants, antiquated tech, union labor, lower demand etc. Normal valuation would be 92 Mil shares x $22-25 PPS = $2.1-2.3 B EV if all was well but it isn't obviously. My 2c....