NEW YORK, May 12 (Reuters) - Danone said on

Monday it has agreed to buy a majority stake in Kate Farms, a

U.S. maker of plant-based organic drinks that will fit into the

French food giant's specialized nutrition portfolio.

Santa Barbara, California-based Kate Farms makes formulas

and shakes for everyday needs as well as for tube feeding for

people with health conditions.

Richard and Michelle Laver founded the company in 2012 after

their daughter Kate, who has cerebral palsy, had difficulties

with eating. Their products are sold to hospitals and consumers

across the country.

"We consider Kate Farms very complementary to our

specialized nutrition offerings and capabilities, which we

believe will allow us to reach more consumers and patients and

bring a high-quality new standard of care to more people with a

wider variety of health needs," Danone Group Deputy CEO Shane

Grant said in an interview. "It's a really important build for

us in the U.S."

The size of the majority stake and financial terms were not

disclosed.

Paris-based Danone, which owns yogurt brand Activia,

plant-based milk brand Silk and Evian water, signaled its

interest in acquisitions after it reported strong 2024 earnings

in February.

Kate Farms has previously raised money from investors such

as Goldman Sachs Asset Management and Main Street Advisors. In

2022, it raised $75 million in a Series C growth capital round.

Kate Farms' senior management will retain a minority stake

in the business, and its CEO, Brett Matthews, will serve as

chairman and CEO of Danone's North American Medical Nutrition

business.

Danone has been operating in the U.S. since 1942, and now

has more than 5,000 U.S. employees and 13 U.S. manufacturing

facilities and one research and development hub. It has a market

value of about $57 billion. The deal is subject to regulatory

approval.