Lifeway Foods Rejects Danone Takeover Bid, Adopts Defense Plan
Source: DairyNews.today
Lifeway Foods has turned down an unsolicited buyout proposal from Danone North America PBC, calling the bid undervalued and not in shareholders' best interests.
In response, the Illinois-based dairy producer's board adopted a shareholder rights plan, often referred to as a "poison pill," to protect against the low-premium takeover attempt.
Danone, the French multinational that already owns a 23.4% minority stake in Lifeway, had offered to acquire the remaining shares at $25 per share.
According to a filing with the U.S. Securities and Exchange Commission (SEC), Lifeway Foods disclosed that its board, after consulting independent financial and legal advisors, rejected Danone's offer, describing it as "opportunistic" and significantly below Lifeway's true value.
"The rights plan is intended to ensure all shareholders can realize the full value of their investment in Lifeway," the company said in a statement.
Under the newly adopted plan, Lifeway will issue one preferred share purchase right per common share to shareholders of record on November 18, 2024. The rights plan, effective immediately, limits Danone’s ability to acquire a controlling stake without paying a premium.
This defensive measure gives the board time to "make informed judgments and take actions that are in the best interests of all shareholders and other stakeholders," Lifeway noted.
By Tuesday afternoon, Lifeway Foods’ shares had risen approximately 0.9%.
Danone, the French multinational that already owns a 23.4% minority stake in Lifeway, had offered to acquire the remaining shares at $25 per share.
According to a filing with the U.S. Securities and Exchange Commission (SEC), Lifeway Foods disclosed that its board, after consulting independent financial and legal advisors, rejected Danone's offer, describing it as "opportunistic" and significantly below Lifeway's true value.
"The rights plan is intended to ensure all shareholders can realize the full value of their investment in Lifeway," the company said in a statement.
Under the newly adopted plan, Lifeway will issue one preferred share purchase right per common share to shareholders of record on November 18, 2024. The rights plan, effective immediately, limits Danone’s ability to acquire a controlling stake without paying a premium.
This defensive measure gives the board time to "make informed judgments and take actions that are in the best interests of all shareholders and other stakeholders," Lifeway noted.
By Tuesday afternoon, Lifeway Foods’ shares had risen approximately 0.9%.
