Lifeway Foods spent little time weighing a second acquisition offer from Danone North America, and the answer is still “no.” The kefir producer officially rejected Danone’s proposal this morning, which included acquiring all remaining Lifeway shares for $27 per share – around $307 million total. The rejection came just five days after the French conglomerate upped its offer on Friday.
Danone is a minority stakeholder (23.4%) in Lifeway and initially moved to acquire the company outright in late September at a price of $25 per share, around $283 million. After more than a month of consideration, Lifeway’s board of directors rejected that pitch on November 5 and adopted a “poison pill” shareholders’ rights plan as a precaution against any hostile takeover attempt.
Lifeway said it has rejected the second proposal after “careful and thorough consideration, conducted in consultation with its independent financial and legal advisors,” believing Danone’s higher pitch still “substantially undervalues Lifeway.”
It would appear that Danone is looking to strike while it’s hot: Lifeway has reported 20 quarters of consecutive growth, with total shareholder returns of 788% in the past five years.
While Lifeway’s leadership is bullish that it can continue to drive high growth, shareholders Edward and Ludmila Smolyansky – respectively the brother and mother of CEO Julie Smolyansky – are unlikely to be happy with this latest news. Two years into a public family feud in which they sought to oust Julie from her role, the pair have been highly supportive of Danone’s motion to buy the business.