August 1, 2004
Parmalat USA’s ice cream distribution business is now part of CoolBrands International Inc. as a result of a deal completed July. Toronto-based CoolBrands purchased the frozen dessert portion of Georgia-based Kinnett Dairy, including customer and route lists, delivery vehicles, trademarks and inventory. Kinnett’s fluid milk operations will remain under operation and ownership by Parmalat USA subsidiary Farmland Dairies LLC, Wallington, N.J. CoolBrands’ Eskimo Pie Frozen Distribution Inc. unit will absorb Kinnett, which distributes frozen desserts to Georgia, Alabama and South Carolina.
In other Parmalat news, Farmland Dairies will gain new leadership and shed non-core units as part of its Chapter 11 restructuring plan. Farmland plans to sell its 80 percent ownership of Milk Products of Alabama LLC to National Dairy Holdings LP for $19.7 million in a deal to close this fall. Meanwhile overseas, the Italian government has reportedly OK’d Parmalat’s restructuring plan, which includes a debt-for-equity swap to repay more than $17 billion to creditors.
And in other CoolBrands news, Weight Watchers International Inc. is suing the frozen dessert manufacturer, alleging CoolBrands plans to continue selling products carrying the diet company’s name after Weight Watchers begins a new licensing deal with Le Mars, Iowa-based Wells’ Dairy. CoolBrands, which manufactures and markets the popular ice cream sandwiches and sundae cones under the Weight Watchers Smart Ones banner, insists the claim is unfounded and also filed suit, alleging Weight Watchers signed with Wells while still under contract with CoolBrands. Under the new deal, Wells’ Dairy will be the exclusive marketer, producer and distributor of frozen novelties and ice cream under the Weight Watchers brand.
Kraft Foods Inc.’s second-quarter net sales were up 4 percent to $8.2 billion from $7.84 billion, but the multinational company reports key commodity cost increases such as cheese (up 70 percent) and soybean oil (up nearly 40 percent) prices caused a 25.5 percent drop in quarter earnings. Northfield, Ill.-based Kraft reported $698 million in quarterly earnings, compared to $949 million in the same quarter last year. The company has lowered profit forecasts for the remainder of 2004.
Dallas-based Dean Foods Co. is rolling its three branded businesses — White Wave, Horizon Organic and Dean National Brand Group — into one unit with expected 2004 sales of $1.1 billion and projected growth of 20 percent annually. This consolidation will bring all of the company’s brands — including Marie’s, Hershey’s Milk, Jakata, International Delight and Silk — under one roof.
Oakhurst Dairy, Portland, Maine, has started construction on a $6 million cooler to boost efficiency and meet growth demands. The 17,000-square-foot refrigerated storage area will house five levels of racks and conveyor equipment to hold up to 46,000 cases of dairy products. The processor plans to use the additional cooler capacity to help increase distribution of its milk and dairy products to its established markets in four New England states, particularly southwestern Massachusetts.
3-A Sanitary Standards Inc. (3-A SSI) last month a second 2004 test date for candidates interested in obtaining certification as a 3-A SSI Certified Conformance Evaluator (CCE). Individuals who meet application requirements will be eligible to sit for the accreditation exam September 30 at BevExpo 2004 in Tampa, Fla.
Frozen novelty maker Silhouette Brands Inc. has been sold to Oakland, Calif.-based Dreyer’s Grand Ice Cream Holdings Inc. for $70 million. New York City-based Silhouette announced in February that it sought a buyer; the company markets lowfat and low-carb ice cream snacks under the Skinny Cow® and Skinny Carb® brands. As a result of the acquisition, CoolBrands International has extended its manufacturing agreement for Skinny Cow products to August 2011. The agreement also states that CoolBrands has right of first refusal to manufacture new Skinny Cow products.
Green Bay, Wis.-based Schreiber Foods has acquired Level Valley Creamery, West Bend, Wis. Terms of the deal were not disclosed, but processing facilities in Nashville, Tenn., and West Bend are included. Level Valley is a private label producer of cream cheese, sweetened condensed milk, butter, anhydrous milkfat and milk powders. Schreiber continues to grow as a major player in the private label cheese arena.
In July, Southwest Cheese Co. LLC. welcomed U.S. Secretary of Agriculture Ann Veneman to observe construction progress of a new $190 million cheese and whey facility being built by Glanbia plc in Clovis, N.M., in a joint venture with Dairy Farmers of America (DFA) and Select Milk Producers.
In July, La Farge, Wis-based Organic Valley held a ribbon-cutting ceremony for its new $5.9 million “green-design” headquarters. The building, with its barn motif, is a symbol of the cooperative’s growth and commitment to rural communities.
The search continues for the 2005 Innovative Dairy Farmer of the Year. Nominations are being accepted for the annual award co-sponsored by the International Dairy Foods Association (IDFA) and Dairy Today magazine. The winner of this year’s award will be honored at the 2005 Dairy Forum, January 9 to 12 at the Disney Yacht & Beach Club in Orlando, Fla. Deadline for nominations is September 24.