France-based Danone entered an agreement to acquire The WhiteWave Foods Company, Denver, CO, for $56.25 per share in an all-cash transaction, representing a total enterprise value of approximately $12.5 billion, including debt and certain other WhiteWave liabilities.

The transaction has been unanimously approved by the Board of Directors of both companies. Its price represents a premium of approximately 24% over WhiteWave’s 30-day average closing trading price ($45.43). The transaction is expected to close by the end of the year, subject to the approval of WhiteWave’s shareholders, regulatory approvals and customary conditions.

WhiteWave is a global company which generated $4 billion in sales in 2015 and has a portfolio of large and leading branded platforms in North America and Europe in high-growth, on-trend food and beverage categories which focus on premium organic dairy, non-GMO, plant-based alternatives to milk and yogurt, fresh foods, and coffee creamers. With a strong entrepreneurial spirit, WhiteWave has a successful track record of transforming categories and creating large scale brands. WhiteWave’s business includes highly recognized, category leading brands such as Silk, So Delicious, Vega, Alpro, Provamel, Horizon Organic, Wallaby Organic, Earthbound Farm and International Delight. Since becoming a public company in 2012, WhiteWave sales have increased at a 19% compound annual growth rate through 2015, and WhiteWave has doubled its operating income during this period.

“At Danone, we constantly seek to align our vision of the world, our mission and our businesses: we believe we have a special responsibility, as expressed in our Manifesto, to help and support people in adopting healthier and more sustainable eating and drinking practices and constantly evolve our portfolio of brands and products to achieve this objective. To that extent, we found in WhiteWave the perfect alliance as we both believe in a healthier future and are conscious of our power to lead society forward,” said Emmanuel Faber, Danone’s CEO. “This unique combination positions us better to address tomorrow’s consumer trends and represents a great opportunity to step change the ambition of our plan for an Alimentation revolution and to accelerate our path towards strong sustainable and profitable growth by 2020. It will allow us to enhance Danone’s growth profile and reinforce our resilience through a broader platform in North America. We are convinced that combining with WhiteWave will create significant value for all of our stakeholders.”

Franck Riboud, Danone chairman, added: “I believe this acquisition advances Danone’s mission and rich history of being at the forefront of emerging consumer trends and commitment to creating economic and social value. The Danone Board of Directors and Strategy Committee unanimously approved this transaction. We believe WhiteWave’s size, positioning and geographical footprint fit perfectly with Danone’s strategy and that it is the right transaction at the right time. The Danone Board will propose that shareholders approve the appointment of Gregg Engles, WhiteWave chairman and CEO as a member of our Board upon completing the transaction as we pursue our ambitious vision together.”

Mr. Engles said the transaction is an exciting next chapter for WhiteWave, bringing together two leading companies with a shared mission of changing the way the world eats for the better. “We believe this is a compelling transaction that delivers significant cash value to our shareholders. Danone is a unique company with distinctive capabilities that will enable WhiteWave to reach its next phase of growth. Danone is a great cultural fit for our organization and I am excited for our employees to benefit from the opportunities presented by joining Danone, a leading global food company and the ideal strategic partner to support our future. I am pleased to be joining Danone’s Board to assist with the exciting and unique journey combining our two companies.”

Growth Opportunities
According to the companies, this transaction represents a key opportunity to enhance Danone’s growth profile and enriches WhiteWave’s opportunities. The strategic and financial benefits of Danone’s acquisition of WhiteWave include:

• Creating a leader strongly aligned with consumer trends for healthier and sustainable eating and drinking options. WhiteWave is well positioned in high growth categories that are supported by strong secular trends. Organic foods and beverages and non-GMO plant-based alternatives to milk and yogurt are among the fastest growing categories in the industry. WhiteWave has been the fastest growing food and beverage company in the U.S. and one of the fastest growing in Europe for the past four years. In joining Danone, WhiteWave will have the opportunity to continue its growth as part of a larger global company with substantial financial, geographic and operational resources. Upon closing the transaction, Danone will have one of the most extensive portfolios of brands and products in fresh dairy, organic foods and beverages and plant-based alternatives to milk and yogurt.
• Building a stronger North America platform. This transaction further diversifies Danone’s portfolio and broadens its presence in North America. The transaction will create a leading U.S. refrigerated dairy player, as well as one of the top 15 largest U.S. food and beverage manufacturers. Following the closing of the transaction, Danone’s North America footprint would increase from 12 to 22% of Danone’ total portfolio.
• Driving strong value and delivering attractive financial benefits. By building on its resources, scale, distinctive R&D and marketing capabilities, and route to market expertise especially in the chilled category, Danone will have significant opportunities to support WhiteWave’s continued growth while also realizing significant sales growth and cost synergies. Danone expects the transaction to be solidly accretive to Danone’s earnings within the first year after closing and to be above 10% accretion based on expected run-rate synergies. The transaction is expected to result in approximately $300 million of EBIT synergies by 2020.