WhiteWave shares slip on first day of trading
NEW YORK -- Shares of organic dairy company WhiteWave Foods slipped on their first day of trading on the New York Stock Exchange.
The stock, which was priced at $17, closed at $16.75 Friday after rising as high as $19.17 in early trading.
WhiteWave Foods Co. sells Horizon organic milks and plant-based dairy alternatives, such as Silk Soymilk. The company was spun off from Dean Foods Co. at a time when the organic and natural foods segment is growing faster than the broader packaged food market.
Dean Foods, one of the nation's largest dairy processors and milk distributors, owns a majority of WhiteWave shares and is using proceeds from the IPO to pay down debt.
WhiteWave raised $391 million in the offering. The shares are trading under the ticker "WWAV."
Shares of Dean Foods meanwhile were down 15 percent at $15.88, after Stifel Nicolaus analyst Christopher Growe downgraded his rating on the shares to "Hold" from "Buy," citing rising dairy costs and a higher-than-expected valuation for WhiteWave.
WhiteWave had initially planned to sell 20 million shares for between $14 and $16 per share.
Growe also noted that Dean Foods, based in Dallas, is exploring to sale of its Morningstar dairy division to focus on its Fresh Dairy segment. Growe estimated the value of Morningstar at $1 billion, which would yield about $800 million in net proceeds for Dean Foods to pay down debt.