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Lifeway Provides Additional Information Regarding Reasons for Rejecting Danone's Revised Proposal
DANOYDanone(DANOY) Prnewswire·2024-11-26 12:30

Core Viewpoint - Lifeway Foods' Board of Directors rejected Danone North America's unsolicited acquisition proposal of 27.00pershare,citingthatitsignificantlyundervaluesthecompanywhileexpressingopennesstoasaleatafairprice[1][2].CompanyPerformance−LifewayFoodshasachieved20consecutivefiscalquartersofyear−over−yeartoplinegrowth[5].−Thecompanyreportedatotalshareholderreturnof78827.00 per share, citing that it significantly undervalues the company while expressing openness to a sale at a fair price [1][2]. Company Performance - Lifeway Foods has achieved 20 consecutive fiscal quarters of year-over-year topline growth [5]. - The company reported a total shareholder return of 788% over the past five years, outperforming high-growth food and beverage peers and the S&P 500 [5]. - Annual revenue increased from 94 million in 2019 to 160millionin2023,markinga71160 million in 2023, marking a 71% increase and a 14% CAGR [5]. - Gross profit rose by 92% over the same five-year period, with an 18% CAGR, achieving 17 million in Operating Income and 22millioninAdjustedEBITDAin2023[5].GrowthPotential−Lifewayisexperiencingdouble−digitgrowth,drivenbyconsumerrecognitionofthegutmicrobiome′simportanceandthebenefitsofkefir[4].−ThecompanyforecastsAdjustedEBITDAtogrowfrom22 million in Adjusted EBITDA in 2023 [5]. Growth Potential - Lifeway is experiencing double-digit growth, driven by consumer recognition of the gut microbiome's importance and the benefits of kefir [4]. - The company forecasts Adjusted EBITDA to grow from 22 million in 2023 to between 45millionand45 million and 50 million by 2027 [5]. - The Board believes Lifeway has reached an inflection point with strong momentum in core products and ongoing operational efficiency improvements [5]. Valuation Considerations - The Danone proposal of $27 per share implies a low EBITDA multiple of approximately 7.5x to 8.5x, not accounting for potential synergies and operational efficiencies [5].