Smolyanskys Provide Update on Lifeway Foods' Consent Solicitation
Edward and Ludmila Smolyansky, influential long-term shareholders of Lifeway Foods, Inc. (NASDAQ: LWAY), who together control approximately 26% of the company's outstanding shares, have stepped forward to give an update regarding the ongoing consent solicitation process. This initiative has been sparked by their definitive Consent Statement filed with the U.S. Securities and Exchange Commission (SEC).
Building Momentum in the Consent Solicitation
"Our outreach program is fully underway, as we see increasing support for our consent solicitation," stated Edward and Ludmila Smolyansky. The couple expressed optimism about the encouraging feedback they have received from fellow shareholders, who share their concerns over the current board's decisions and approach.
Addressing the Company's Position
In a recent announcement, Lifeway Foods issued a statement asserting that the consent solicitation lacks legal standing. They indicated that merely filing the Consent Statement does not provide sufficient notice to shareholders, and they also pointed out that a record date has not been established. Additionally, the company urged its shareholders to disregard the Smolyanskys' recent communications.
However, the Smolyanskys pointed out a significant oversight by the board: Edward Smolyansky had formally requested both a record date and a shareholder list in a letter dated June 17, a request that the company has yet to fulfill. This response highlights the ongoing disconnect between management and shareholders.
Mr. Smolyansky addressed the board's actions:
"It’s disappointing to see that the Board is attempting to suppress shareholder voices to evade accountability yet again. All shareholders should be concerned that directors, who have already postponed the 2025 annual meeting, are poised to contest our written consent without addressing their own lack of action. We urge shareholders to rally behind our initiative by signing and returning the WHITE consent card, as detailed in our definitive consent statement."
Contradictions in Board Actions
Further complicating matters, recent securities filings reveal a disconcerting situation regarding the board’s confidence in its earlier statements. The board has claimed that Danone’s offer of $27 per share “severely undervalues” the company, which was used to justify implementing a poison pill strategy aimed at defending against such offers.
Interestingly, Jason Scher, the lead independent director, dramatically liquidated nearly all of his shares, retaining just one share. This transaction, amounting to nearly $600,000, raises concerns as it seems to contradict the board's stance on Danone’s offer. The Smolyanskys have called for clarity on how Mr. Scher’s recent actions align with the board's publicly stated views regarding Lifeway's valuation.
Edward Smolyansky expressed concern: "How can shareholders have confidence in a Board whose members are selling off their own shares while insisting we reject an offer they previously deemed significantly low? This situation brings into question the future direction of the company and the potential value of our holdings."
A Call to Shareholders
In light of these developments, Edward and Ludmila Smolyansky respectfully encourage all shareholders to complete and return their WHITE consent cards, following the instructions detailed in their definitive consent statement. This collective action is vital to ensuring that all voices within the shareholder community are heard.
For further inquiries or to engage with the shareholder group, they invite interested individuals to visit FreeLifeway.com and other platforms they manage.
Frequently Asked Questions
What is the current status of Lifeway Foods' consent solicitation?
The consent solicitation is actively progressing with support from shareholders who converge on their shared concerns about the board's current decisions.
Why do Edward and Ludmila Smolyansky believe shareholders should participate?
They advocate for shareholder participation to enhance accountability within the board, emphasizing the importance of shareholder voices in corporate governance.
What actions have the Smolyanskys proposed to shareholders?
The Smolyanskys encourage shareholders to execute and return WHITE consent cards to demonstrate their support for the Smolyanskys' proposal.
What concerns do the Smolyanskys have regarding board member actions?
They are troubled by recent transactions from board members, particularly significant share divestitures, which seem contradictory to the board's stance on corporate valuation.
How can shareholders get more information on this topic?
Shareholders can find additional details and stay updated by visiting the platforms suggested by Edward and Ludmila Smolyansky.
