Danone exits Lifeway Foods after 26-year investment and failed takeover bids
What's the deal? Danone is selling its entire 22.7% stake in Lifeway Foods, the US kefir maker, ending a 26-year investment marked by failed takeover attempts and legal disputes. The French dairy giant has priced a secondary underwritten public offering of roughly 3.45 million Lifeway shares at $19.50 each, with the deal expected to close on May 19.
Lifeway will not receive any proceeds from the sale but has agreed to repurchase about $5M worth of shares at the same price paid by investors, conditional on the offering closing.
"We decided not to pursue the acquisition of the company," a Danone spokesperson said. "This decision does not change our strategic focus on delivering high quality, healthy plant based and dairy products to American consumers."
Why now? The exit caps a turbulent two years between the companies. In 2024, Danone tabled two takeover offers — at $25 and $27 per share — both of which Lifeway rejected as undervaluing the business.
Danone then launched legal proceedings against Lifeway over a decision to award shares to chief executive officer Julie Smolyansky. The two sides briefly resumed acquisition talks in mid-2024, but by September Danone said it would not make another offer and would consider selling its stake.
A co-operation deal struck in late 2024 brought a temporary truce: Lifeway agreed to refresh its board and separate its chair and CEO roles, while Danone agreed not to support any board replacement effort before the end of June 2025. With that window closing, the sale appears to be Danone's cleanest path out.
What could go wrong? The $19.50 offering price sits well below the $25 and $27 per share Danone previously offered for the entire company — a sign the stake sale may yield a disappointing return. Lifeway also faces an unresolved family feud between Julie Smolyansky and her mother and brother, Ludmila and Edward Smolyansky, the company's largest shareholders. Edward Smolyansky accused the company of "blatant deception" in December over governance issues.
Without Danone as a major shareholder, Lifeway's board dynamics could shift unpredictably — particularly if the Smolyansky family dispute intensifies.
The signal: Danone's retreat underscores how difficult hostile — or even semi-hostile — acquisitions can be in the US food sector, especially when target companies have entrenched founders and complex ownership structures. In 2025, Lifeway posted net sales of $212.4M, up 13.7% year on year, with operating income climbing 16.7% — suggesting it has the growth story to stay independent.
For Danone, the move frees up capital and attention for its broader strategy. But it also marks a rare public admission that a quarter-century bet on a niche US brand simply didn't pay off the way it hoped.
Read more: just-drinks.com
