Danone has offered to buy US kefir and probiotic products maker Lifeway Foods in a proposed $283m (£211.3m) deal.
The unsolicited offer follows the French multinational supplier expanding into the kefir market with the Activia brand in the UK earlier this month. The spoonable and drinkable kefir range will hit the shelves of Waitrose, Tesco and Morrisons by the end of this month, and be available at other retailers by the end of the year.
Danone already holds a 23.4% minority share in Lifeway Foods, and a deal for the remaining stake would value the business at $25 a share (or about $283m).
It represents a 59% premium over the US family-run firm’s recent average share price of $15.74.
In a letter addressed to Lifeway CEO Julie Smolyansky, Danone said the merger presented “an attractive opportunity” for the business to “achieve its full potential”.
“We are confident that Danone’s operations and dedicated resources would unlock significant opportunities and value for Lifeway, notably by providing further innovation, distribution and marketing support,” the letter added.
Lifeway registered a 13% jump in annual sales in 2023 to $160m (£119.5m) and has recorded 19 successive quarters of year-on-year growth.
The non-binding offer follows news of various challenges facing Lifeway, including family disputes over leadership and accusations of mismanagement, with major shareholders reportedly pushing for a sale.
A statement released by Lifeway, which sells its products across the US, Mexico, Ireland, South Africa and France, said the board would “carefully review and evaluate the proposal to determine the course of action that it believes is in the best interests of the company and its stakeholders”.
“The company does not undertake any obligation to provide any updates with respect to this or any other proposal or transaction, except as required under applicable law,” it added.
Barclays was supportive of a deal. “We think this would be a good deal financially and strategically and we think it could do a lot with the brand in the US,” said analyst Warren Ackerman.
No comments yet