Lifeway removes ‘poison pill’ ahead of shareholders’ meeting

Lifeway Foods has cancelled a arguable shareholder rights' program days earlier an capitalist gathering volition ballot connected the make-up of the company's board.

The alleged 'poison pill' measure, successful spot since 2024, was abandoned successful the aftermath of proxy advisory steadfast Institutional Shareholder Services (ISS) recommending shareholders ballot against Lifeway's slate of nominees astatine the gathering connected 17 June.

In a connection yesterday (8 June), Edward Smolyansky, Lifeway’s largest shareholder and the member of CEO Julie Smolyansky, accused the company's committee of “reactive governance”, saying the committee scrapped the program lone erstwhile “external unit leaves nary alternative”.

Just Food has approached Lifeway for comment.

Last year, the US kefir shaper decided to widen the shareholder rights program until 29 October 2026. Lifeway adopted the rights program successful November 2024 aft turning down takeover involvement from Danone.

At the time, Mr. Smolyansky, a long-time, vocal professional of governance astatine Lifeway, described the hold arsenic the “most brazen illustration of committee and absorption entrenchment”, adding it was astir “protecting control” of the business.

The rights program was primitively adopted to thwart acquisition bids for the business.

French dairy large Danone made 2 takeover offers for Lifeway successful 2024, bids the US radical turned down.

The narration betwixt Lifeway and Danone - which archetypal invested successful the concern successful 1999 - became strained aft Lifeway rejected the offers.

However, trhe companies signed a “co-operation” woody successful September past year. Under that agreement, Lifeway pledged to “refresh” its committee and abstracted its seat and CEO roles, portion some parties agreed to “stay” litigation betwixt the 2 companies.

In April this year, Lifeway said it would trim the size of its committee from 8 to 7 directors astatine its upcoming AGM.

Last month, Danone announced the merchantability of its full involvement successful Lifeway.

On 3 June, Lifeway nominated long-serving manager Jason Scher for re-election, saying helium provides “historical cognition and continuity”.

In an SEC filing, the institution added: “Accordingly, the committee has nominated Mr. Scher to basal for re-election arsenic manager of the institution astatine the yearly gathering and determined that the size of the committee should proceed to beryllium 8 directors aft predetermination of directors astatine the yearly meeting."

In a connection yesterday, Mr Smolyansky said the determination to propulsion the poison pill aft the ISS proposal and the renomination of Scher "raise cardinal questions astir accountability, transparency, and credibility" astatine Lifeway.