WhiteWave (WWAV) Stock Continues to Jump on Danone Offer
NEW YORK (TheStreet) -- Shares of WhiteWave Foods (WWAV) are spiking 18.57% to $56.24 on heavy trading volume late Thursday afternoon after yogurt giant Danone (DANOY) agreed to acquire the company for an enterprise value of about $12.5 billion.
Danone will pay $56.25 per share for the Denver-based organic food producer, which represents a premium of about 24% over WhiteWave's 30-day average closing price.
The acquisition will double the size of Danone's U.S. business, the company said.
The transaction is expected to close by the end of the year and is subject to approval from regulators and WhiteWave's shareholders.
"There may be competing bids in the coming weeks," D.A. Davidson said in a note to clients cited by CNBC.com.
The firm noted that companies such as Coca-Cola (KO), PepsiCo (PEP), General Mills (GIS), Campbell Soup (CPB) and Kellogg (K) "have all been rumored to have been interested in purchasing WhiteWave."
TheStreet's Jim Cramer, portfolio manager of Action Alerts PLUS and director of research Jack Mohr wrote in a note to subscribers Thursday that they are "ecstatic" to see the best-case scenario play out for WhiteWave.
But Cramer and Mohr said they would not be surprised to see counterbids because "WhiteWave looks like a once-in-a-lifetime opportunity for any fledgling packaged food company with dry powder."
About 41.09 million of WhiteWave's shares changed hands by late this afternoon vs. its average 30-day volume of 1.54 million shares per day.
Shares of Danone are increasing 1.2% to $14.32 this afternoon.
(WhiteWave is held in Jim Cramer's charitable trust Action Alerts PLUS. See all of his holding with a free trial here.)
Separately, TheStreet Ratings Team has a "Buy" rating with a score of B on the stock.
The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, revenue growth, expanding profit margins, notable return on equity and compelling growth in net income.
The team believes its strengths outweigh the fact that the company has had lackluster performance in the stock itself.
Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
You can view the full analysis from the report here: WWAV