Groupe Danone Partnership

Stonyfield Farm, USA, a national leader in organics, natural nutrition and corporate environmental responsibility, enjoys a strategic partnership with Groupe Danone (Danone), the France-based consumer products company known for its sales of bottled water, dairy products and biscuits. Stonyfield is the leading organic yogurt producer in the world. Danone is a worldwide consumer products company with brands ranging from Danone yogurt to Evian water to LU biscuits.

The partnership with Groupe Danone, announced in October 2001, has given Stonyfield management access to a vast range of know-how and talent in Danone's worldwide team of manufacturing, purchasing, logistics, and other efficiency experts. In December 2003, Danone purchased all non-employee-owned shares of Stonyfield stock, enabling it to achieve majority ownership of the company, and thus consolidating Stonyfield's financial results. But in a unique, if not unprecedented, relationship, Gary Hirshberg, Chairman, President and CE-YO, continues to manage the company independently, and also retains majority board control.

A Win/Win Arrangement

The Stonyfield Farm/Danone deal is unprecedented in the current climate of food industry consolidation. Over the last few years, numerous smaller, natural and organic product companies have been acquired by bigger conglomerates, fueling growth for mainstream companies with niche, fast-growing brands. Many of those examples (Kraft/ Boca Burger, Nestle/Power Bar, Kellogg's/Kashi, Unilever/Ben & Jerry's) have resulted in changes of control and management of the acquired firm. The Stonyfield Farm/Danone partnership, developed so as to enable both firms to "walk before they run", has been engineered not only to ensure Stonyfield's continued management autonomy, but also to ensure that its ambitious organic, environmental and social missions will be unimpeded as well. The Stonyfield Farm/Danone partnership is an excellent model for enabling emerging value-driven firms to gain in strength and stature, while remaining loyal to the growing base of consumers who seek organic and natural products.

Compatible Missions: Environmental Responsibility

Stonyfield Farm, USA has received numerous awards over the years for its waste reduction, energy efficiency, and environmental advocacy efforts. In the U.S., the company recycles most of its manufacturing solid waste, invests in green packaging research and carbon offsets to neutralize its manufacturing plant's contribution to global warming, uses its lids and packaging to promote environmental causes, donates 10% of its profits to environmental causes and has converted 90% of its products to organic certification. All of these same policies will be applied to its Canadian operation.

Danone has, for many years, contributed to the development of environmental regulation in France and Europe. The company continually explores environmental monitoring programs and innovation in "greener" packaging, integrated farming and energy efficiency. Danone has also employed programs that have resulted in the reduction of waste and resource usage, recycling and ISO certification in more than 50% of their sites worldwide.

Compatible Missions: Health and Nutrition

Both companies are leaders in delivering innovative products that offer health and nutritional benefits.

Stonyfield Farm is a leader in product innovation and functional yogurts in North America. In Canada, the yogurt contains FIVE live active cultures: S. thermophilis, L. bulgaricus, L. acidophilus, Bifidus and L. casei. Bifidus and L. casei. Stonyfield Farm yogurt also contains inulin (a natural dietary fibre derived from chicory root). Stonyfield Farm uses only milk from organic farmers who live by strict organic farming methods and policies.

Danone, an international leader in the research and development of functional foods, supports scientific research through the Danone Institute, an educational organization dedicated to furthering research on topics of health and nutrition ranging from probiotics to calcium. Some of the company's products that are targeted to specific nutritional needs include Activia probiotic yogurt, calcium-enhanced water, energy-fortified biscuits and many others.