Danone has raised its bid to acquire Lifeway Foods, a U.S. manufacturer of kefir and fermented probiotic products, in a significant move that reflects the evolving dynamics within the food and beverage industry. The French multinational, which holds a minority stake of approximately 23.4% in Lifeway, has submitted an offer of around $27 per share, marking a noteworthy increase from its initial proposal of $25 per share.
Earlier this month, Lifeway declined Danone’s initial offer, claiming that it substantially “undervalued” the company. In response, Danone emphasized that the new proposal represents a remarkable 72% premium compared to Lifeway’s three-month volume-weighted average share price as of the day preceding the initial bid on September 23.
In its recent communication, Lifeway acknowledged the “revised, unsolicited, non-binding proposal” from Danone and expressed its intention to carefully consider this offer. Danone’s renewed interest in Lifeway comes at a time when the latter is grappling with internal family disputes over control and leadership.
Shane Grant, Danone’s deputy CEO, conveyed his disappointment regarding Lifeway’s board’s response to the initial proposal in a letter addressed to Lifeway’s chair and CEO, Julie Smolyansky. He asserted that the enhanced offer “fully reflects the fundamental potential” of Lifeway and assures its shareholders “the certainty of an attractive and immediate cash premium.” Grant stressed that a merger with Danone would enable Lifeway to reach its full potential, alleviating the pressures and resource requirements typical of a publicly traded company.
This acquisition attempt unfolds amidst ongoing family tensions at Lifeway, particularly between Ludmila and Edward Smolyansky—Lifeway’s largest investors—and the current leadership. In August, they moved to unseat the existing board, which includes CEO Julie Smolyansky, asserting the need for a leadership team anchored in revitalizing the company with a vision aligned with shareholder interests. They expressed strong support for Danone’s revised offer when Lifeway initially rejected the bid.
As the food and drink consumer trends continue to shift, the implications of this potential acquisition could reshape the landscape of the food and beverage industry. Just Food has reached out to the Smolyansky family for their thoughts on Danone’s latest proposal.
In summary, Danone’s pursuit of Lifeway Foods emphasizes strategic moves within the food and drink business, highlighting the increasing significance of capitalizing on emerging consumer trends in the competitive sector.
