Winnetka-based Hoffmann makes play for Oberweis Dairy

The Hoffman Family of Companies, a private equity firm out of Winnetka, announced Tuesday that it will attempt to acquire Oberweis Dairy, an iconic brand that filed for bankruptcy earlier this month.

According to a release from Hoffmann, the firm — through a subsidiary, Osprey Capital — plans to make a “competitive offer” and “is confident” it will be the highest bid.

Oberweis Dairy, which began in Aurora, Illinois, in 1927 selling milk, delivers its products — including its trademark milk in glass jars — direct to thousands of homes, operates 48 ice cream and dairy stores, and distributes to grocery stores. On April 12, the North Aurora-based company filed for Chapter 11 protections through the Northern District of Illinois in order to “seek debt relief” and position the company for a sale, according to a company statement.

In its filing, according to the Chicago Sun-Times, Oberweis owes more than $4 million to its top 20 creditors, which include Cook County ($173,000).

In its media statement, Hoffmann — which through Hoffmann Commercial Real Estate is the largest commercial property owner in Winnetka — said it is interested in Oberweis “because of its highly regarded history, brand and alignment with family values.”

“Our vision is all about quality, legacy and longevity — we’re not looking to buy and flip businesses,” said Geoff Hoffmann, co-CEO of Hoffmann Family of Companies, in the release. “The Oberweis name has been associated with delicious, premium quality products for decades.

“Notwithstanding its recent financial struggles, we see an opportunity to revive the company’s heritage of success. This may take many different shapes or forms and we are highly enthusiastic about the prospect of our involvement.”

Hoffmann’s founder, David Hoffmann, reportedly grew up on a farm in Washington, Missouri, and delivered milk before school. David Hoffmann launched his first company in 1989 and grew a family enterprise that has since acquired more than 200 companies that employ 9,000 individuals worldwide.

Even with a competitive bid, Hoffmann faces immediate competition to acquire Oberweis, which announced on Tuesday, April 23, a “stalking horse” bidder in local businessman Brian Boomsma, owner of Chicago’s Dutch Farms. A stalking horse bidder is an entity of the bankrupt company’s choosing that makes an initial bid on the company’s assets, setting a purchase floor for all remaining bidders.

“We are thrilled to have a business leader like Brian Boomsma interested in investing in Oberweis and enabling the company to continue to move forward and prosper,” Oberweis President Adam Kraber said in a statement. “We continue to be grateful to our loyal customers, vendors, and committed employees who have supported us through this process.”

In its release, Hoffmann acknowledged the presence of Dutch Farms and the understanding of a process to evaluate all bids.

Oberweis expects the company to be under new ownership by late June, according to its statement.

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