Danone Offers to Acquire Lifeway Foods
Danone, a major player in the dairy industry, has made a cash offer of $25 per share to acquire the remaining stock of kefir products maker Lifeway Foods that it does not already own. This offer represents a 59% premium to Lifeway’s average stock price over the last three months, showing Danone’s confidence in the potential of the company.
As a long-time shareholder in Lifeway, owning 23.4% of its common shares, Danone is familiar with the inner workings of the company. Lifeway has seen success in recent years, especially during the pandemic era when consumer interest in gut health surged. The company reported record annual sales of $160 million in 2023, with 19 consecutive quarters of year-over-year growth.
Consumers have turned to Lifeway’s kefir products for their health benefits, including aiding digestion and promoting bone and heart health. Danone, known for its healthy dairy products like Activia and Too Good yogurts, sees the acquisition as an opportunity to expand its portfolio and tap into the growing demand for better-for-you offerings.
If the acquisition goes through, Danone plans to leverage its global scale to further grow Lifeway’s products and unlock significant value for the company. This move could also address calls from critics, including Kanen Wealth Management, for Lifeway to explore strategic alternatives and maximize shareholder value.
Despite Lifeway’s recent success, the company has been embroiled in a family feud involving CEO Julie Smolyansky and her relatives, who have criticized the board’s governance and financial performance. The acquisition by Danone could provide a fresh start for Lifeway and enable it to reach its full potential under new leadership.
Overall, the potential acquisition of Lifeway Foods by Danone signals a new chapter for both companies and could lead to exciting developments in the dairy industry.