PepsiCo was interested in buying WhiteWave, the parent of organic milk seller Horizon, but passed because of the high cost before French dairy firm Danone last week inked a $12.5 billion deal for the company, Josh Kosman reports.

The move was part of a year-long plan to transform Pepsi away from carbonated sodas.

Indra Nooyi’s company has tracked WhiteWave and knew it was open to a sale, a source close to the situation said.

“Pepsi made it clear to WhiteWave’s bankers [in recent months] at these multiples, forget about it,” the source said. While Pepsi balked at the price, Danone was ready to pay a better than 20 percent premium to the stock price. PepsiCo said last week it was comfortable with its portfolio of brands.