Soy milk company at the center of Phil Mickelson insider trading scandal is getting bought
Phil Mickelson’s favorite soy milk company is getting bought.
WhiteWave Foods, maker of Silk soy milk, was the company at the heart of the insider trading case in June involving pro golfer Mickelson and sports gambler Billy Walters. Now the French food giant Danone will acquire WhiteWave for $12.5 billion.
The deal will immediately double the size of Danone’s U.S. business by adding healthy products like Silk and Earthbound Farm Organic salads to a lineup that includes yogurts Activia and Actimel.
WhiteWave (WWAV) was owned by Dean Foods (DF) until 2012, when Dean spun off WhiteWave. The insider trading case involving the spinoff first began in May 2014, when the SEC investigated Mickelson, Walters and Carl Icahn, but did not bring charges. One year later, in August 2015, the SEC shifted the investigated to Walters, Mickelson, and former Dean Foods chairman Thomas Davis, and again did not bring charges.
But in June, Davis and Walters were named as defendants in the SEC’s civil complaint, and Mickelson only as a “relief defendant,” someone the SEC defines as, “not accused of wrongdoing but are named in SEC complaints for the purposes of recovering alleged ill-gotten gains in their possession from schemes perpetrated by others.”
Here’s where WhiteWave came in: According to the SEC, Dean Foods chairman Davis repeatedly gave gambler Walters inside information, including “sneak previews of at least six of the company’s quarterly earnings announcements.” In July 2012, Walters called his friend Mickelson, at a time when Mickelson owed him money, and “urged Mickelson to trade in Dean Foods stock.” Mickelson acted on the tip, buying up Dean stock on July 30 and July 31, 2012. The next day, Dean announced the spinoff of WhiteWave, and Dean stock popped 40%.
Mickelson’s ill-gotten gains amounted to $931,000, all from a single trade, when Mickelson unloaded his Dean shares on Aug. 8, 2012. He will return the $931,000 to the SEC, plus another $105,000 in interest. Walters pleaded not guilty in court last month to 10 different counts of criminal fraud.
Meanwhile, a different sports gambler also tied to Mickelson, Gregory Silveira, was sentenced last month to a year in prison for laundering nearly $3 million in funds for an unnamed “gambling client.” ESPN identified the client as Mickelson.
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Daniel Roberts is a writer at Yahoo Finance, covering sports business and technology. Follow him on Twitter at @readDanwrite.
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