Danone is selling its stake in Lifeway Foods, drawing a line under its long-running and sometimes strained relationship with the US kefir maker.
The French giant, which invested in Lifeway in 1999, holds around 22.7% of the company. Two years ago, Danone tabled takeover offers for Lifeway, which the business rejected.
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In a statement to Just Food today (18 May), a Danone spokesperson said: “Following extensive discussions with Lifeway Foods and having explored all options regarding our existing holding, we decided not to pursue the acquisition of the company.
“We have now entered into an agreement to sell our stake in Lifeway Foods. This decision does not change our strategic focus on delivering high quality, healthy plant based and dairy products to American consumers.”
In a separate statement on Thursday (14 May), Lifeway said Danone has priced a secondary underwritten public offering of 3,454,756 Lifeway shares at $19.50 each.
The offering is expected to close tomorrow (19 May), subject to customary conditions.
Lifeway said the offering consists entirely of shares sold by Danone and that the US company will not receive any proceeds.
In the statement, Lifeway said it has agreed to repurchase about $5m worth of the shares at the same price paid by investors, although that buyback is conditional on the offering closing.
Lifeway turned down two takeover approaches from Danone in 2024, one priced at $25 a share and another $27, saying the offers undervalued the business and amounted to a “hostile takeover”.
In March last year, Danone instigated legal proceedings against Lifeway over a decision to award CEO Julie Smolyansky with shares in the business. Lifeway responded by saying it intended to file a counterclaim against Danone.
In August, it emerged “representatives” of Danone and Lifeway had started talks to “reset” the relationship and hold discussions over a “potential acquisition”.
However, a month later, Danone said it would not table another offer and would weigh up whether to sell its 22.7% stake. The Activia maker said it would also ponder whether to support a move by Lifeway’s largest shareholder to replace the company’s board.
A month later, the two sides struck a co-operation deal. Lifeway agreed to “refresh” its board and separate its chair and CEO roles. The businesses also agreed to “stay” the litigation between them.
In return, Danone agreed not to support any attempt to replace the board before the end of June this year.
Amid the tension between Danone and Lifeway, a long-running family feud has festered at the US firm between Julie Smolyansky, and her mother and brother, Ludmila and Edward Smolyansky, the company’s largest shareholders.
In December, Edward Smolyansky accused the company of “blatant deception” as a family and governance dispute continued ahead of the company’s annual meeting.
In 2025, Lifeway generated net sales of $212.4m, a 13.7% increase on a year earlier. Operating income climbed 16.7% to $16.1m. Net income grew 53.6% to $13.8m.
In the first quarter of this year, the company’s net sales increased 36.7% year on year to $63m. Operating income surged to $6.32m from $1.57m. Net income rose 32% to $4.6m.
