White Wave Files ComplaintAgainst Dean Foods and Suiza

White Wave Files ComplaintAgainst Dean Foods and Suiza

BOULDER, Colo.--Soy beverage manufacturer White Wave Inc. (WW) (www.whitewave.com) filed a complaint in U.S. District Court in Denver on June 14 against Franklin Park, Ill.-based Dean Foods(NYSE:DF) and Dallas-based Suiza Foods Corp. (NYSE:SZA) to protect its Silk brand and shareholders from a possible DF merger withSuiza.

DF and its subsidiary Dean Dip and Dressing, which was also named in the complaint, signed a licensing agreement with WW for the Silk brand back in August 1999 and effectively gained a 36-percent interest in the Silk manufacturer. In April 2001, DF and Suiza agreed to a $2.5 billion merger, which would result in the combined company, to be named Dean Foods, having both Silk and Suiza's Sun Soy brand under the same roof, as well as subject DF's minority interest to a direct WW competitor, Sun Soy. WW alleged that with the 36-percent stake, its direct competitor could gain blocking rights to all major corporate transactions, access to all of WW's proprietary information and the right to elect two members to WW's seven-member board of directors. Thus, WW is seeking to enforce the right of first refusal with respect to any transfer of its shares.

"Our agreements with Dean Dip were specifically designed to prevent a direct competitor of ours, such as Suiza, from obtaining the control over our business that they will obtain in this merger," stated Steve Demos, founder and chief executive officer of WW. "While we are not trying to disrupt the Suiza-Dean Foods merger, we will pursue all remedies necessary to make certain our contractual rights and our shareholders' interests are protected."

"This is merely a contractual dispute, the lawsuit does not attempt to block the merger," said LuAnn Lilja, spokesperson for Dean Foods. "We don't believe the merger triggers WW's right of first refusal. Prior to WW filing its lawsuit, we filed an action in federal district court in Chicago asking that the court declare that the merger transaction is not a transfer that triggers that first right of refusal." On Suiza's gaining control of a part of WW, she noted, "The merger...doesn't give Suiza control of the whole company [Dean Foods]."