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Danone to acquire another food group WhiteWave

United States: The largest producer of yogurt Danone will pay USD56.25 per share in the deal, which is 24% above the WhiteWave’s average stock overs the past month including debt & liabilities. This deal is poised to increase the size of the company in terms of share & the products because of the popularity of healthy foods offered by WhiteWave such as Silk almond milk, Earthbound Farm Organic salad. The recent performance of Danone has slowed down in emerging markets including Brazil and Russia. The acquisition of WhiteWave would account for 22% revenue to increase by 12% for better competition with nestle in North America.

WhiteWave’s 19% increase in share have started to attract higher offers this is due to packaged food industry are now under pressure because of the growth in organic food industry. WhiteWave’s product portfolio has outperformed packaged foods and focusing on the consumer shift healthy lifestyles and natural foods.

According to TechSci Research, the US Organic Food industry has largest of profits adding USD4.2billion in sales from previous year. U.S is the top organic hub, and with their relation to other local economies have been benefitted visa-versa. This steady increase in organic sector has led to increase in average household income in the United States by over USD2,000 and lowering the poverty rate. The acquisition of whitewave by Danone would make the company one of the biggest U.S. refrigerated dairy player, as well as one of the top 15 largest U.S. food and beverage manufacturers.

According to recent report published by TechSci Research “United States Organic Foods Market Forecast & Opportunities, 2020”, the market for organic food products in the US is projected to cross USD45 billion in 2015. Organic fruits and vegetables segment holds the largest market share, with demand driven by retail consumers, hotel chains as well as restaurants. The market is likely to witness continuous growth in the coming years due to implementation of more stringent environmental protection policies and animal welfare programs by the US government. Major players engaged in offering organic foods in the country include Hain Celestial, Amy’s Kitchen and WhiteWaves Food Inc. 

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