Lifeway Foods rejects Danone proposal, adopts shareholder rights plan

Lifeway Foods (LWAY) has rejected the unsolicited proposal made on September 23 by Danone North America to acquire all the shares of Lifeway that it does not already own for $25.00 per share. After consideration conducted in consultation with its independent financial and legal advisors, the board determined that Danone’s proposal substantially undervalues Lifeway and is not in the best interests of the company and its shareholders or other stakeholders. In addition, in response to Danone’s proposal and its substantial ownership position in the company, the board adopted a limited duration shareholder rights plan, effective immediately. Under the Rights Plan, Lifeway will distribute to its shareholders one preferred share purchase right for each outstanding share of Lifeway common stock to shareholders of record at the close of business on November 18. Initially, these rights will not be exercisable and will trade with, and be represented by, the shares of Lifeway common stock. The rights will become exercisable if an entity, person or group acquires beneficial ownership of 20% or more of the outstanding shares of Lifeway common stock in a transaction not approved by the Board or if an entity, person or group that currently beneficially owns 20% or more of the outstanding shares of Lifeway common stock acquires any additional shares. Unless earlier redeemed, terminated or exchanged pursuant to the Rights Plan, the rights will expire on November 4, 2025.