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French dairy giant Danone is selling its entire stake in US kefir producer Lifeway Foods, bringing an end to the relationship between the two companies.
Danone, which first invested in Lifeway in 1999, held approximately 22.7% of the company. The move follows a turbulent period that included rejected takeover bids, legal disputes and governance tensions between the businesses.
In a statement released on 14 May, Lifeway confirmed that Danone had priced a secondary underwritten public offering of 3.45 million shares at $19.50 each.
Lifeway said the offering consists entirely of shares sold by Danone, meaning the company itself will not receive any proceeds from the sale. However, Lifeway has agreed to repurchase around $5m worth of shares at the same offering price, contingent on the transaction completing.
The divestment closes the chapter on Danone’s unsuccessful efforts to acquire Lifeway in 2024. The French group submitted takeover proposals valuing the company at $25 per share and later $27 per share, both of which were rejected by Lifeway’s board. The kefir maker argued the bids significantly undervalued the business and described the approach as a “hostile takeover”.
Relations between the companies deteriorated further in March last year when Danone initiated legal proceedings over Lifeway’s decision to award shares to chief executive Julie Smolyansky. Lifeway responded by announcing plans to file a counterclaim.
Despite the conflict, both parties attempted to repair relations later in 2024. In August, representatives from the companies entered discussions aimed at “resetting” their relationship and exploring a potential acquisition. However, by September, Danone confirmed it would not submit another offer and instead began considering options for its minority holding, including a possible disposal.
Operationally, Lifeway has continued to post strong growth despite the boardroom tensions. The company reported 2025 net sales of $212.4m, up 13.7% year on year, while operating income rose 16.7% to $16.1m. Net income climbed 53.6% to $13.8m.
Momentum has continued into 2026. In the first quarter, Lifeway posted a 36.7% increase in net sales to $63m. Operating income surged from $1.57m to $6.32m, while net income rose 32% to $4.6m.
Commenting on the divestment, 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.”