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Danone sells off its US organic dairy assets

Danone sells off its US organic dairy assets Danone Food and Beverage Business

As part of its Renew Danone turnaround strategy, French dairy giant Danone has sold its US-based Horizon Organic and Wallaby units to local investment business Platinum Equity. The move is part of CEO Antoine de Saint-Affrique’s commitment to disposing of “under-performers” while focusing on other core brands. The organic dairy units made up about 3% of Danone’s global revenues, and the company will retain a minority stake in the business.

“Today marks an important milestone in delivering this commitment, while giving the Horizon Organic and Wallaby businesses the opportunity to thrive under new leadership,” said De Saint-Affrique. “This sale, once completed, will allow us to concentrate further on our current portfolio of strong, health-focused brands and reinvest in our growth priorities.”

The sale of the Colorado-based organic dairy units, which produces milk, yogurt, creamers, butter, and cheese, was first mentioned a year ago and has been under strategic review. Danone inherited the Horizon Organic unit when it acquired US group WhiteWave Foods for $12.5bn in 2016, a deal that doubled its size in the US market. The company had upped its 2023 revenue guidance and announced that the Renew turnaround strategy is bearing fruit. It expected like-for-like sales growth to reach 6-7% this year, compared to a previous estimate of 4-6%.

In December, Danone revealed it was in talks to sell its French baked goods business Michel et Augustin to a “Ferrero-related” Belgian holding company CTH Invest.

This selling strategy aligns with Danone’s commitment to asset rotation for businesses that fall outside its priority growth areas of focus to drive value creation. It is a significant milestone in the delivery of this commitment, and it will allow the company to concentrate further on its current portfolio of strong, health-focused brands and reinvest in its growth priorities.

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