LWAY Lifeway Foods Inc

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

Under the Securities Exchange Act of 1934

(Amendment No. 4)*

LIFEWAY FOODS, INC.

(Name of Issuer)

Common Stock

(Title of Class of Securities)

531914109

(CUSIP Number)

(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)

With copies to:

Joshua R. Cammaker

Wachtell, Lipton, Rosen & Katz

51 W 52nd St, New York, NY 10019

Tel: (212) 403 1000

September 23, 2024

(Date of Event Which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§ 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box: ☐

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

CUSIP No. 531914109

CUSIP No. 531914109

Introductory Note

This Amendment No. 4 to Schedule 13D relates to the common stock, no par value (the “Common Stock”), of Lifeway Foods, Inc., an Illinois corporation (the “Issuer”), and amends the Schedule 13D filed on October 12, 1999 (the “Initial Filing”), as amended by Amendment No. 1 to Schedule 13D filed on October 29, 1999, Amendment No. 2 to Schedule 13D filed on November 10, 1999 and Amendment No. 3 to Schedule 13D filed on January 5, 2000 (the Initial Filing together with Amendments Nos. 1-3, the “Original Schedule 13D”).

This Amendment No. 4 is being filed to amend the Original Schedule 13D as follows:

Item 2. Identity and Background.

Item 2 of the Original Schedule 13D is hereby amended and restated to read as follows:

Danone S.A. is a French société anonyme with its principal place of business at 17 boulevard Haussmann, 75009 Paris, France.

Danone North America PBC (together with Danone S.A., the “Reporting Persons”) is a Delaware public benefit corporation with its principal place of business at 1 Maple Avenue, White Plains, NY 10605. Danone North America PBC is a wholly owned subsidiary of Danone S.A.

None of the Reporting Persons, and to the knowledge of the Reporting Persons none of the persons listed on Schedule A hereto, has during the last five years, been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors).

None of the Reporting Persons, and to the knowledge of the Reporting Persons none of the persons listed on Schedule A hereto, has during the last five years, been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction as a result of which it was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.

Item 4. Purpose of Transaction.

Item 4 of the Original Schedule 13D is hereby amended and supplemented to add the following:

On September 23, 2024, Danone North America PBC sent a letter (the “Letter”) to the Issuer, proposing to acquire all of the outstanding shares of Common Stock not currently held by the Reporting Persons for a purchase price of $25.00 per share in cash (the “Proposed Transaction”). The transaction would be wholly funded in cash from existing cash reserves of the Reporting Persons and is not contingent on any financing requirements. The proposal is subject to the completion of due diligence and negotiation of definitive agreements. The foregoing summary of the Letter is not intended to be complete and is qualified in its entirety by reference to the full text of the Letter, which is filed herewith as Exhibit 99.1 and is incorporated herein by reference.

No assurances can be given that the Proposed Transaction will be consummated. No legally binding obligation with respect to the Proposed Transaction will arise unless and until the relevant parties enter into mutually acceptable definitive documentation. This Schedule 13D is not an offer to purchase or a solicitation of an offer to sell any securities.

The Reporting Persons intend to engage in discussions with the Issuer regarding the Proposed Transaction. The Reporting Persons may change the terms of the Proposed Transaction, determine to accelerate or terminate discussions with the Issuer with respect to the Proposed Transaction, withdraw the proposal described in the Letter or any other proposal with respect to the Proposed Transaction, take any action to facilitate or increase the likelihood of consummation of the Proposed Transaction, or change their intentions with respect to any such matters, in each case at any time and without prior notice. The Reporting Persons and their subsidiaries will, directly or indirectly, take such additional steps as they may deem appropriate to further the Proposed Transaction or otherwise to support their investment in the Issuer, including, without limitation: (a) engaging in discussions with other shareholders, potential sources of financing, advisors and other relevant parties; and (b) entering into confidentiality arrangements, financing commitments, and other agreements, arrangements and understandings in connection with the Proposed Transaction.

The Proposed Transaction may result in one or more of the actions specified in clauses (a) to (j) of Item 4 of Schedule 13D, including, without limitation, the acquisition of additional securities of the Issuer, a merger or other extraordinary transaction involving the Issuer, the delisting of the Common Stock from the Nasdaq and the Common Stock becoming eligible for termination of registration pursuant to Section 12(g)(4) of the Securities Exchange Act of 1934, as amended.

The Reporting Persons intends to review their investment in the Issuer on a continuing basis. Depending on various factors, including, without limitation, the outcome of any discussions referenced above, the Issuer’s financial position, results and strategic direction, actions taken by the Issuer’s management and the Board, price levels of the Common Stock and other investment opportunities available to the Reporting Persons, the Reporting Persons may in the future take such actions with respect to their investment in the Issuer as they deem appropriate, including, without limitation, acquiring additional Common Stock and/or other equity or other securities of the Issuer or disposing of some or all of the securities beneficially owned by them in public market or privately negotiated transactions and/or otherwise changing their intention with respect to any and all matters referred to in Item 4 of Schedule 13D.

Item 5. Interest in Securities of the Issuer.

The disclosures responsive to clauses (a)-(c) of Item 5 of the Original Schedule 13D are hereby amended and restated to read as follows:

(a)—(b). The responses of the Reporting Persons to Rows (7) through (13) of the cover pages of this Amendment No. 4 are incorporated herein by reference.

The aggregate 3,454,756 shares of Common Stock beneficially owned by the Reporting Persons represent approximately 23.4% of the issued and outstanding shares of Common Stock based on 14,790,747 shares of Common Stock outstanding as of August 6, 2024, as reported by the Issuer in its Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2024 filed with the Securities and Exchange Commission on August 13, 2024.

Danone North America PBC has sole voting and sole dispositive power with regard to 3,454,756 shares of Common Stock. Danone North America PBC is a wholly owned subsidiary of Danone S.A. Danone S.A., by virtue of its relationship to Danone North America PBC may be deemed to indirectly beneficially own (as that term is defined in Rule 13d-3 under the Act) the shares of Common Stock which Danone North America PBC directly beneficially owns. Danone S.A. disclaims beneficial ownership of such shares of Common Stock for all other purposes.

(c). There have been no transactions in shares of Common Stock that were effected during the past sixty days by the Reporting Persons other than as reported in this Amendment No. 4.

Item 7. Material to be Filed as Exhibits.

SIGNATURE

After reasonable inquiry and to the best of our knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

Schedule A

Certain Information Concerning the Directors and Executive Officers of Danone S.A.

The names, positions, principal occupations (if other than their position with Danone S.A.) and citizenship of Danone S.A.’s directors and executive officers are set forth below. The address and principal place of business for each listed director or executive officer is c/o Danone S.A., 17 boulevard Haussmann, 75009 Paris, France.

Certain Information Concerning the Directors and Executive Officers of Danone North America PBC

The names, positions, principal occupations (if other than their position with Danone North America PBC) and citizenship of Danone North America PBC’s directors and executive officers are set forth below. The address and principal place of business for each listed director or executive officer is c/o Danone North America PBC, 1 Maple Avenue White Plains, NY 10605.

Exhibit 99.1

		Julie Smolyansky Chairperson of the Board, President and Chief Executive Officer   Lifeway Foods, Inc. 6431 West Oakton St. Morton Grove, IL 60053 United States of America   September 23, 2024

Strictly Private & Confidential

Proposed Acquisition of Lifeway Foods, Inc.

Dear Julie,

As you are aware, Danone SA, through its wholly owned subsidiary Danone North America PBC (“Danone”, or “we”), has been a shareholder in Lifeway Foods, Inc. (“Lifeway”, “the Company”, or “you”) for more than two decades.

In this capacity, we have had the privilege of closely following the development of your Company, its ability to deliver consistent growth over time, especially in the most recent quarters, to bring to market kefir products matching consumers’ demand and preferences, and to establish Lifeway’s brand image.

In recognizing the solid performance of the Company over the last few years, we believe Lifeway has an attractive opportunity to achieve its full potential through a combination with Danone, removing the constraints and additional resources required for a publicly listed company of Lifeway’s size. We are confident that Danone’s operations and dedicated resources would unlock significant opportunities and value for Lifeway, notably by providing further innovation, distribution and marketing support.

These considerations have encouraged us to consider the merits and feasibility of a Transaction under which Danone would acquire all of the issued and outstanding share capital of the Company it does not already own, subject to the terms and conditions set out below (the “Transaction”), and provide the Lifeway shareholders with immediate liquidity at an attractive premium.

This letter outlines this non-binding proposal (the “Proposal”) and sets out the basis on which we would like to engage in discussions with the Board of Directors of the Company (the “Board”) with a view to signing a definitive agreement rapidly.

Our Proposal reflects Danone’s understanding of your business and remains consistent with our disciplined strategy of enhancing the quality of our portfolio through acquisitions.

Danone is a France-based global producer of dairy, nutritional products and waters, with almost 90,000 employees, and products sold in over 120 markets. Danone generated €27.6 billion in sales in 2023. We are organized around three verticals: Essential Dairy & Plant-Based products (52% of Danone’s sales in 2023), Specialized Nutrition (31%) and Waters (17%), with operations in five geographical areas: Europe (34% of Danone’s sales in 2023), with France, Spain, Germany and the U.K. being the largest markets; North America (25%); China, North Asia & Oceania (13%); Latin America (10%); and the Rest of the World (18%), including Asia Pacific, Africa and the Middle East.

In June 2024, we opened the next chapter of our Renew strategy, focusing on the 2025-28 period and projecting our company into the future of Health and Nutrition, with notably a strong focus on Gut Health, which is driving our interest in considering the benefits of a potential combination with Lifeway.

Valuation

Subject to the terms and conditions of this Proposal, we would be prepared to pay $25 per Lifeway share (the “Indicative Price”), in all cash, for the entire share capital of the Company. This Indicative Price implies a premium of 59% over the 3-month volume weighted average price¹.

We believe that this Indicative Price represents a compelling proposition to Lifeway’s shareholders and reflects the fundamental potential of the Company. The Proposal also provides Lifeway’s shareholders with the certainty of an attractive and immediate cash premium.

Our Proposal has been based solely on publicly available information and remains subject to, among other matters, satisfactory completion of our confirmatory due diligence. For the avoidance of doubt, our Proposal assumes no dividend or other distribution is authorised, declared, made or paid in respect of Lifeway shares, and no material revisions to the executive compensation arrangements on or after the date hereof.

Financing

The Transaction would be wholly funded in cash from Danone cash reserves and is not contingent on any financing requirements. With a market capitalization of more than €40bn, Danone is one of the largest FMCG companies globally. The Group had more than €2.0bn cash available as of June 30, 2024.

Confirmatory Due Diligence

We are prepared to conduct a more in-depth, efficient and targeted, confirmatory due diligence exercise to validate our current valuation assumptions.

We have attached as Schedule A an overview of our key due diligence requests. We stand ready to begin this confirmatory due diligence as soon as practicable and subject to execution of a mutually agreed non-disclosure agreement, and to discuss with the Company’s management the most efficient way to conduct this process.

Regulatory

We expect consummation of the transaction to be subject to antitrust clearance under the U.S. Hart-Scott-Rodino Act, and do not foresee significant issues with receiving these approvals. Consummation of the transaction would also be subject to other customary conditions.

Approvals and next steps

The submission of this Proposal has been approved by Danone’s Board of Directors.

We have dedicated a team of senior Danone executives to this matter. Daniela Dalton (daniela.dalton@danone.com), the Danone Head of Mergers and Acquisitions, will be the primary point of contact on our side. We also have retained J.P. Morgan, Wachtell, Lipton, Rosen & Katz, Vedder Price and KPMG as our advisors on the Transaction. We and our advisors are prepared to move forward expeditiously.

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Subject to our being able to access immediately information required as part of our confirmatory due diligence and negotiating Transaction Documentation in parallel, we are confident in our ability to reach a definitive agreement in three weeks.

Non-binding Proposal

Nothing in this Proposal is, nor is intended to be, legally binding or contains any form of representation or obligation, and nothing in this Proposal shall give rise to a right or remedy for any party. This Proposal is not a binding offer, and is intended solely to indicate our preliminary, non-binding interest in exploring the possibility of engaging in a Transaction and is not intended to create any legal binding commitment or obligation or form the basis of any legal remedy or claim against Danone nor any of their affiliates, nor create any legal relationship between any of the foregoing on the one hand and Lifeway or any of its affiliates or shareholders on the other hand.

We may engage in or terminate discussions relating to the Transaction contemplated in this Proposal at any time and without notice or any reason therefor and without being liable for any indemnification or otherwise whatsoever.

Furthermore, this Proposal is not intended to be exhaustive on the matters which may be covered by any negotiations, requests for information or any agreements or contracts which may follow.

Based on our Schedule 13D obligations, we will make a public filing which will disclose this letter.

*   *

We are excited to deliver this Proposal. We believe that Danone is in the ideal position to deliver meaningful value creation to all shareholders and other stakeholders and to drive Lifeway’s continued development. We hope you and the rest of the Board will appreciate and act on the great value proposition for shareholders reflected in this Proposal. We would be pleased to have the opportunity to discuss this Proposal and next steps further, at your earliest convenience.

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Schedule A

Key Due Diligence requests

The main information requests to conduct our confirmatory due diligence are listed below. Some information could be addressed as part of dedicated sessions with management.

Financial

Business

4

Legal & Corporate (to the extent not publicly available)

Regulatory

Tax

5