Oberweis Dairy to be taken over by private equity firm

Auction followed dairy’s bankruptcy filing

Oberweis Dairy has filed for Chapter 11 bankruptcy protection, according to multiple media reports. The North Aurora-based company filed in the Northern District of Illinois, showing more than $4 million in debt to various creditors.

A Winnetka-based private equity firm has won the auction to acquire Oberweis Dairy Inc., and its assets following the dairy company’s recently announced Chapter 11 bankruptcy.

Hoffmann Family of Companies, through its investment arm, Osprey Capital LLC, announced they were the prevailing bidder during Wednesday’s auction to acquire the North Aurora-based, family-owned dairy company.

“We are thrilled to write the next chapter of the company’s story with the wonderful employees at Oberweis Dairy,” Geoff Hoffmann, co-CEO of Hoffmann Family of Companies, said in a news release. “Their dedication and passion for delivering exceptional dairy products align perfectly with our values.”

Oberweis filed for Chapter 11 reorganization bankruptcy on April 12.

The agreement to purchase is subject to approval by the United States Bankruptcy Court, and the terms of the agreement have not been disclosed.

In the release, the Hoffmann family said they have a tradition of investing in multi-generational, family-owned businesses. The family-owned private equity firm comprises more than 100 national brands and employs 9,000 global employees with businesses located in 30 countries and 250 sites across the world.

As part of the acquisition, Hoffmann Family of Companies said it plans to make strategic investments throughout Oberweis. The Aurora plant, in particular, will receive significant attention to enhance production capabilities and streamline operations.

Oberweis President Adam Kraber said in the release that they look forward to working with Hoffmann.

“Our exceptional product set, accompanied by a brand that stands for quality that is second to none, is the foundation for our team members and company to write its next chapter,” Kraber said.

Oberweis has been family owned and operated since 1927, currently led by the third and fourth generations. The company distributes its products through its 48 ice cream and dairy stores, as well as through grocery stores and its home delivery service.

In its bankruptcy paperwork, the company cited declining milk consumption and “improvident” business decisions as reasons for the bankruptcy. It also announced it would lay off 127 workers at the North Aurora plant starting in June if it couldn’t find a buyer.