Lifeway Foods (LWAY) said Monday that its board has responded to a recent letter sent by investor Danone North America reaffirming that it rejected Danone's unsolicited takeover offer for the company because it "severely undervalues" Lifeway.

In a December 30 letter sent to Lifeway's board, Danone said it was preparing litigation against the company alleging that it broke a shareholder agreement between the two companies. The agreement was valid when the parties signed it in 1999 and it continues to be valid, Danone said.

Lifeway said Monday that the agreement violates Illinois law and that it plans to explore all available remedies to enforce state law and nullify the deal. The health food company's board reiterated that it is not opposed to a sale at a price that "more accurately" reflects its true value.

Lifeway also said it expects Q4 net sales in a range of $45.1 million to $46.6 million and full-year 2024 net sales of $185 million to $186.5 million. Two analysts surveyed by FactSet are expecting Q4 net sales of $47.5 million and full-year net sales of $187.4 million.

The company's shares were down 0.5% in recent trading.

Price: 23.88, Change: -0.13, Percent Change: -0.54