Appaloosa, founded by the billionaire investor David Tepper, has purchased a 7.35% stake in US dairy processor Dean Foods.

A filing with the New York Stock Exchange on Friday (7 January) showed Appaloosa Management held 13.4m shares in the company as of 28 December.

Dean Foods shares rose more than 11% on news of the purchase Friday to reach US$9.89.

The dairy giant has struggled in recent months amid rising commodity costs and fierce competition in the own-label milk category. The firm’s net income has declined year-on-year for the last four quarters.

Last week, meanwhile, it was announced that Dean Foods had sold its customer-brand yoghurt business to Schreiber Foods.