Lifeway Foods bolsters position in drinkable dairy space with new acquisition

By Mary Ellen Shoup

- Last updated on GMT

Photo Credit: Lifeway Foods
Photo Credit: Lifeway Foods

Related tags Lifeway Foods Kefir Yogurt Probiotics

Lifeway Foods, best known for its kefir products, announced the intent to acquire certain assets of California-based GlenOaks Farms for $5.8m this week, expanding the company's position in the drinkable dairy space, says CEO Julie Smolyansky.

Through the acquisition, which is expected to close later this month, Lifeway said it will assist the GlenOaks brand in developing a more robust market presence for its line of six drinkable yogurt products in the West Coast region and explore opportunities to expand the brand nationwide.

"We've already received verbal commitments from several retailers who are making shelf space for GlenOaks ​[products],"​ Smolyansky told FoodNavigator-USA, who noted how the acquisition unlocks further growth opportunities for Lifeway as well. 

Already a national brand with a more concentrated presence in the Midwest region, Smolyansky said bringing GlenOaks into the fold will broaden the portfolio and consumer reach of Lifeway, which has long been waving the kefir flag but has ambitions to be seen as a leader in the broader fermented dairy category. 

LifewayFoods

"This is a diversification that I think is really important for Lifeway,"​ Smolyansky told FoodNavigator-USA.

"We think there’s a lot of opportunity to take market share from some other brands and scale the business, and continue to show we are the gold standard of probiotics."

'The pandemic has only expedited the interest in gut health and immunity'

The company has consumer demand on its side as interest in fermented dairy products such as kefir -- and more broadly, probiotics -- has accelerated especially as more consumers took charge of their health in light of the global pandemic, noted Smolyansky. 

Lifeway recorded its eight straight quarter of growth, reporting net sales of $29.4m for Q1 2021 (three months ended March 31, 2021), a 15.7% increase from the year prior. 

"We know that the pandemic has only expedited the interest in gut health and immunity, and that is something Lifeway is really dedicated to,"​ she said, noting how the science around probiotics and their health benefits continues to build. 

"I’m excited about the probiotics space. What's really driving this market is the science and research around gut health. It’s only in the beginning stages of its life, especially here in the US, where we've only begun to scratch the surface."

'I’m excited about the probiotics space'

Smolyansky added that she wants to be seen as a probiotics company and believes strategic acquisitions in new sub categories such as drinkable yogurt as well as in-house innovation will help the company achieve that identity. 

Observing the rise of non-dairy probiotic options at retail, Smolyansky noted that Lifeway is set to launch a probiotic oat drink later this year to compete head-to-head with its competitors that have extended into non-dairy alternatives.

Lifeway continues to expand its global presence with distribution in Mexico, Paris (at Costco), 250 additional locations in Ireland, and the UK.

"As much as we can democratize the concept of wellness -- that is the goal. And the fact that we can do that at the grocery store in every corner of the country… that’s what consumers are looking for and what Lifeway stands for,"​ added Smolyansky. 

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