Stater Bros. Completes Sale of Santee Dairies

Stater Bros. Markets here said yesterday it has completed the sale of Santee Dairies, a wholly owned subsidiary, to Dean Foods, Dallas, for an unspecified amount.

SAN BERNARDINO, Calif. — Stater Bros. Markets here said yesterday it has completed the sale of Santee Dairies, a wholly owned subsidiary, to Dean Foods, Dallas, for an unspecified amount.

"The future growth of Santee Dairies products was limited because most potential customers are competing supermarket chains that already operate their own dairies," Jack Brown, chairman and chief executive officer of Stater, said in a release. "At Stater Bros., we try to do the 'Right Thing ... for the Right Reason.' The right thing is to sell Santee Dairies to Dean Foods to ensure the continued growth of Santee. The right reason is to protect the future of the Santee 'Family' of Employees."

When he announced the pending sale to Dean Foods in April 2009, Brown said competing chains had been advised by their parent companies not to purchase products from Santee because it would contribute to Stater's expansion.

Stater Bros. Markets will continue to purchase Santee's fine dairy products, including Stater Bros. Milk, ValuTime Milk, Knudsen Milk, and Arnold Palmer tea products, Brown added in the release, and will use proceeds from the sale to look at real estate and other opportunities.

Santee was originally founded, in partnership with Knudsen Dairies, by Ralphs and Hughes Markets, which merged before Ralphs became part of Kroger. Stater became a Santee stakeholder in 1986, when it purchased 50% of the stock from then-bankrupt Knudsen; it purchased the remaining shares from Kroger in 2004.

Dean Foods sells products under more than 50 local and regional Brands and manufactures products in more than 100 facilities in 40 states and employs more than 26,000 people.

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