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Danone Sells Stake in Lifeway Foods After Failed Acquisition Attempts
- Danone is divesting its 22.7% stake in Lifeway Foods after deciding not to pursue an acquisition of the kefir maker.
- The dairy giant made the decision to sell off its shares after exploring all options regarding its existing holding.
- Danone has been a shareholder of Lifeway for over two decades and has made multiple attempts to acquire the company. However, it abandoned its most recent proposal last fall to focus on its own brands.
Background of the Danone-Lifeway Relationship
The relationship between Danone and Lifeway has been tumultuous, marked by lawsuits and accusations of corporate bullying by Lifeway against Danone.
Lifeway has experienced significant growth in sales, with net quarterly sales surpassing $60 million for the first time. The demand for kefir, a fermented dairy drink rich in probiotics, is on the rise due to its health benefits.
As Lifeway’s sales have increased, the company has resisted Danone’s attempts to acquire it and has sought to nullify its original agreement with the dairy giant.
Current Developments
Danone has decided to sell its stake in Lifeway for $19.50 a share, significantly less than its previous offer of $27 a share.
The company stated that it will focus on delivering high-quality plant-based and dairy products to consumers in the U.S. instead of pursuing the acquisition of Lifeway.
Meanwhile, Danone is expanding its own kefir business, with products like Activia kefir gaining popularity in European markets.
Group Deputy CEO and CFO Juergen Esser expressed excitement about the success of kefir products and hinted at further expansion into global markets.