WhiteWave Foods (WWAV) Ratings Placed on CreditWatch Positive by S&P Amid Takeover Deal

S&P Global Ratings said that it placed its ratings, including its 'BB' corporate credit rating, on The WhiteWave Foods Co. (NYSE: WWAV) on CreditWatch with positive implications, meaning that we could either raise or affirm the ratings following the completion of our review.

As of March 31, 2016, the company's lease-adjusted debt outstanding was approximately $2.1 billion.

The CreditWatch placement follows Danone's announcement that it signed a definitive agreement to acquire all of the outstanding shares of WhiteWave for $56.25 per share, in cash. The transaction is valued at about $12.5 billion ($10.4 billion in stock and the remainder in debt and certain other WhiteWave liabilities).

"We believe WhiteWave's credit profile will improve with the acquisition by the higher-rated Danone (BBB+/CreditWatch Neg/--) as the company will benefit from greater distribution and purchasing scale, Danone's manufacturing capabilities, and a complementary global portfolio of brands," said S&P Global Ratings credit analyst Jessica Paige.

On a pro forma basis, the combined company will generate over $30 billion in sales for the 12 months ending December 2016.

We plan to resolve the CreditWatch listing in the next several months, as we get more details about the combined entity's plan to realize synergies, its final capital structure, and the timing and potential impediments to completing the transaction. When the transaction closes (pending shareholder and regulatory approvals), which we expect to be at the end of 2016, we may withdraw the ratings on WhiteWave.

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