Westrock Coffee Co. of Little Rock announced a joint venture with Select Milk Producers Inc. of Dallas to build a multi-serve bottle plant at a Select Milk site in Littlefield, Texas.
In a news release, Westrock said the joint venture will provide its customers with a cost-effective and sustainable option for coffee-based ready-to-drink products in a format that includes dairy and dairy alternatives.
The plant will be constructed and operated inside a new facility Select Milk is building in Littlefield. Westrock will produce and provide coffee extracts and concentrates from its Conway facility and Select Milk, a farmer-owned dairy cooperative, will provide milk from its Littlefield facility.
The companies expect the first product from the lines to ship in the first quarter of 2026.
Select Milk is one of the nation’s largest dairy cooperatives, with more than 110 dairies in the Southwest and Midwest and eight processing plants. Members produce a variety of traditional and specialty dairy products, including powder, cheese, whey protein, cream and butter.
As part of the venture, and in response to customer demand, Westrock is expanding production capacity at its $300 million ready-to-drink packaging facility in Conway. Production is expected to begin later this year.
To fund the expansion and the formation of the joint venture, Westrock issued $72 million in convertible senior unsecured notes due in 2029 in a private offering. The notes, which bear a 5% annual interest rate, are convertible into shares of the company’s common stock in certain circumstances and during certain periods at a price of $12.84 per share.
Westrock completed work on a $70 million distribution center in Conway in January.
The publicly traded company is scheduled to report earnings for the fourth quarter and full year on March 12. Westrock expects its 2023 adjusted EBITDA to fall near the low end of its guidance range of $45 million to $50 million.
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