Lifeway Foods Rejects Danone's Acquisition Offer, Claims Value Undervalued

Lifeway Foods Reaffirms Its Position Against Danone's Offer

Lifeway Foods, Inc. (NASDAQ: LWAY), a premier U.S. supplier specializing in kefir and other probiotic products, has recently reaffirmed its rejection of Danone's unsolicited takeover offer. The Board of Directors of Lifeway has indicated that the offer significantly undermines the company's value according to detailed analyses provided by independent financial and legal advisors.

Projected Sales and Financial Outlook

Promising Fourth Quarter Results

In line with its ongoing commitment to business growth and innovation, Lifeway has announced preliminary unaudited net sales between $45.1 million to $46.6 million for the fourth quarter of this year. These encouraging figures reflect the company's robust market position and strategic planning.

2024 Revenue Expectations

Looking ahead to 2024, Lifeway expects full-year unaudited net sales to be in the range of approximately $185.0 million to $186.5 million. This is a significant increase when compared to last year's revenue, which stood at $160.1 million, highlighting Lifeway’s successful approach to scalability and customer engagement.

Legal Perspectives on the Stockholder Agreement

The Lifeway team has also raised concerns regarding an existing stockholder agreement with Danone, asserting that it violates Illinois law. The company maintains that this invalid agreement does not attain validity over time merely because its terms have been adhered to. Lifeway is set to pursue legal avenues to nullify this agreement, reflecting its commitment to shareholder interests.

Leadership and Strategic Vision at Lifeway

Julie Smolyansky, Chairwoman and CEO of Lifeway, emphasized the company's resilience in the face of Danone's opportunistic offer. She stated, "Danone is opportunistically determined to push through an inadequate offer while Lifeway continues to deliver substantial value for its shareholders." This sentiment reinforces Lifeway's strategic trajectory focused on long-term growth and sustainability.

Performance Metrics and Competitive Edge

Under Smolyansky’s leadership, Lifeway has achieved remarkable milestones: 21 consecutive quarters of growth, double-digit revenue growth in the third quarter of 2024, and total shareholder returns soaring by 788% and 270% over the past five and three years, respectively. These figures are indicative of Lifeway's competitive advantage over other players in the food and beverage industry as well as exceeding benchmarks set by the S&P 500.

Commitment to Stakeholders

As Lifeway navigates the complexities of potential acquisitions and market dynamics, it remains focused on protecting its stakeholders' interests. The Board has indicated they will diligently assess the ongoing relationship with Danone and strategize effectively to safeguard the company's future.

About Lifeway Foods, Inc.

Lifeway Foods is recognized as a leader in probiotic beverages, particularly known for its kefir products, which are sold in numerous regions including the United States and several international markets. The company's diverse product range also includes specialty cheeses and kid-friendly probiotic options.

Frequently Asked Questions

What was Lifeway Foods' response to Danone's offer?

Lifeway Foods firmly rejected Danone's unsolicited takeover offer, asserting that it undervalues the company.

What are the projected sales figures for Lifeway Foods in 2024?

Lifeway Foods projects its net sales for 2024 to range between $185.0 million and $186.5 million.

Why does Lifeway believe the stockholder agreement is invalid?

The company argues that the 1999 stockholder agreement with Danone violates Illinois law and intends to pursue its nullification.

What accomplishments has Lifeway attained under leadership?

The company has achieved 21 consecutive quarters of growth and significant shareholder returns, showcasing its effective management.

How is Lifeway Foods positioned in the market?

Lifeway Foods is recognized as a leading supplier of kefir and other probiotic products, maintaining a competitive edge in the food and beverage industry.

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