Edward Smolyansky, entrepreneur and founder of Lucy’s Organics, Inc., has entered into an agreement to acquire the assets, including plant and equipment, of a turnkey dairy manufacturing facility in southwestern Wisconsin, about 140 miles from Milwaukee. This acquisition is a strategic move in Smolyansky’s plan to meet the growing market demand for fermented milk drink kefir and plant-based alternatives.
Smolyansky is currently engaged in a proxy campaign at Lifeway Foods (NASDAQ: LWAY), where he is one of the largest shareholders. He also recently launched a new venture, Pure Culture Organics, a wholly-owned subsidiary of Lucy’s Organics, Inc.
The nearly 100,000-square-foot facility is poised to become a pivotal asset for Smolyansky’s business ventures. He plans to retrofit the plant for kefir production, with operations expected to start in 2025. The facility can process approximately 1 million pounds of fluid milk per day, with the potential to scale capacity.
Additionally, Smolyansky intends to fully segregate part of the facility to produce an alt-kefir beverage derived from almonds and cashews. According to Smolyansky, “There doesn’t appear to be a non-dairy based kefir product in the United States right now, so several retailers have approached me about filling that void with a nut-based probiotic drink. This facility’s unique footprint and capabilities should allow us to produce both products without the risk of allergy cross-contamination, a common issue in food processing plants.”
If Smolyansky’s proxy campaign is successful, he intends to present the facility for independent review by the reconstituted Lifeway Foods board. Alternatively, Pure Culture Organics may use the facility as its first kefir production site. The facility is ideally located to support logistical efficiency and accelerate product distribution across the Midwest.
A key feature of the facility is its advanced on-site wastewater treatment and methane capture system. The plant can process up to 120,000 gallons of wastewater per day, converting dairy waste into biomass and capturing up to 93,500 cubic feet of methane gas daily, which is then returned to the local energy grid. This sustainable energy initiative will significantly reduce waste disposal costs, an often overlooked but substantial operating expense in older, less environmentally friendly dairy processing facilities. The plant’s capacity to scale up wastewater treatment as production increases offers further operational flexibility and benefits.
“As the probiotic dairy market continues to grow post-pandemic, this plant will enable us to better meet increasing demand with efficient, large-scale production,” added Smolyansky. “It’s a prime example of how smart investment and innovation can drive sustainability while reducing costs.”
Lucy’s Organics has also entered into a partnership agreement with Super Natural Foods, a privately held trading firm specializing in alternative assets and advisory services. The partnership will involve marketing and support for this initiative, as well as upcoming collaborative projects and opportunities.
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