Dean Foods receives interim access to $50 million of DIP financing

By Caroline Salls

Pittsburgh, Nov. 14 – Dean Foods Co. obtained court approval to access $50 million in debtor-in-possession financing on an interim basis, according to an order filed Thursday with the U.S. Bankruptcy Court for the Southern District of Texas.

The final hearing is scheduled for Dec. 20.

The financing is being provided by some of Dean’s existing lenders, led by Rabobank.

Specifically, Rabo has committed to provide $425 million in financing, $189 million of which will refinance existing term loans. The proposed DIP credit agreement also provides for a $234.8 million new money revolving loan facility and the refinancing of loans under the company’s senior secured revolving credit facility.

The DIP facility will mature nine months from the bankruptcy filing date, subject to a three-month extension.

The DIP loans will bear interest at the Base rate plus 600 basis points or Libor plus 700 bps.

The company said it expects to use the DIP financing, together with cash on hand and operating cash flows, to support its continued operation throughout the Chapter 11 process, including payment of employee wages and benefits without interruption and payment to suppliers and vendors in full under normal terms for goods and services provided on or after the filing date.

Dean Foods is a Dallas-based food and beverage company. The company filed bankruptcy on Nov. 12 under Chapter 11 case number 19-36313.

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