Family owners of Portland’s Alpenrose Dairy plan to sell the business to a Seattle-area company after a century of operation while retaining the land where the dairy sits and where community events have flourished for years.

The dairy’s controlling family members are finalizing a sale to Smith Brothers Farms of Kent, Washington, another family-owned company, said Rod Birkland, Alpenrose’s president. The deal could be finalized within 30 days.

But other family members oppose the sale, including the dairy’s former co-president, Carl Cadonau Jr., who said he was forced out of the company in January. Three family members, Cadonau’s grown children, on Friday renewed their legal efforts to prevent the sale from moving forward.

Smith Brothers would continue to operate the dairy in Portland, Birkland said, but 150 Alpenrose workers must reapply to keep their positions when the sale is finalized. He said he expected most would keep their positions.

Birkland, a great-grandson of Alpenrose founder Florian Cadonau and Carl Cadonau Jr.'s cousin, didn’t disclose a sale price or other terms of the agreement, saying they were still in flux. He said Smith Brothers would rent the Alpenrose Dairy facilities and acquire its equipment.

The sale clouds the future of the Alpenrose Dairy land, which the company has long shared with the community. The land includes three baseball diamonds, a quarter midget auto racing track, the western-themed Dairyville, the Alpenrose Velodrome bike-racing track and a 600-seat opera house that hosts community theater productions, meetings and movie screenings.

A lawsuit filed earlier this year by the great-great-grandchildren of the founder sought to block an earlier sale to Smith Brothers that included both the dairy and the land, but they dropped it when the deal was called off. The lawsuit had said the continued family operation of the dairy and the maintenance of the land as public assets are closely linked.

Siblings Carl Cadonau III, Cary Cadonau and Tracey Cadonau McKinnon have now resumed the legal effort, saying in a newly filed complaint that their own offer to buy the dairy operations for $7 million was voted down in this latest round. The trio said theirs was the better offer and the other family members had breached their fiduciary duty by accepting Smith Brothers’ offer instead.

The dissenting family members accuse those who voted to sell of seeking to shut down events at Alpenrose and sell the land for development. The lawsuit alleges Rod Birkland and Wendell Birkland, another family member, said they “would rather run Alpenrose Dairy into the ground" than sell to the trio.

The complaint also claims Smith Brothers has no intention of continuing operations at Alpenrose in the long term but rather wants to acquire the company’s name and market share and shut down the dairy operations, which in turn would free family members to sell the land.

Dustin Highland, the chief executive of Smith Brothers Farms, didn’t return a phone message, but in a written statement said customers would see little change and that the company intended to “have continuity in the workforce and in business operations in general.”

“There are no plans to shutter their current facilities,” Highland said. “The terms of the agreement include a lease of the existing dairy operating facilities. We certainly hope that Alpenrose employees will want to remain part of the organization.”

He also said the company hoped to bring home delivery, an old-school mainstay of Smith Brothers’ business, to the Portland area. (Alpenrose was one of the last local dairies to stop delivering milk in the 1970s.)

Rod Birkland said his family’s intention is to continue operating the venues, but that it was an expensive venture.

Alpenrose faced losing its insurance for the sports facilities and venues because its current provider wouldn’t continue to include them in a blanket policy, Rod Birkland said.

He said he expected they would continue to operate through the next baseball season but couldn’t make a commitment beyond that. If the family fails to find another insurance provider, even next season could be off the table.

“That would be a stopper,” he said.

Carl Cadonau Jr., the former co-president who retains ownership shares in the company, said family members had pressured him to stop holding events while he remained in charge because of their expense. He said he refused to stop the events and was fired shortly after.

“It was out of spite, there’s no way around it,” he said. “And to keep me out of the loop.”

Cadonau said he wasn’t told about the sale before he was contacted by a reporter Friday.

Rod Birkland said the dairy remains a viable business, but that the controlling family members were selling now because he believes the company would be stronger combined with another.

“We think it’ll be better for all our employees,” he said. “So many dairies stay a little too long, if you know what I mean. They run completely down, and then they have no choices. We still have choices.”

Competition in the dairy business has grown intensely. Grocery chain-operated dairies have crowded out smaller competitors, Rod Birkland said, and Alpenrose is the last of what were once dozens of Portland-operated dairies.

-- Elliot Njus

enjus@oregonian.com; 503-294-5034; @enjus

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