The merger of the giant milk industry is transferred through a deal worth 425 million dollars

The largest US milk cooperative has reached an agreement to purchase “a large portion” of the troubled Dean Foods company, the two parties announced on Monday.

Under the agreement, the cooperative, Dairy Farmers of America, will pay $ 425 million to purchase 44 Dean Food facilities, in addition to the real estate, inventory and equipment needed to operate them. But the deal must be approved by the bankruptcy court that oversees Dean Food as well as government antitrust agencies.

The American Dairy Farmers company was founded to help small farmers market raw milk to dairy manufacturers such as Dean Foods, which prepares milk for distribution to retailers.

Over the years, the cooperative has also invested heavily in processing, which means it buys some of the raw milk it sells to its marketing branch. Some dairy farmers argue that these investments have created a struggle, because processors benefit from lower milk prices, while farmers benefit from higher prices. Potential merger critics say the Dean Foods purchase will expand cooperative processing operations significantly, further increasing conflicts of interest.

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