General Mills Announces Agreements to Sell Its North American Yogurt Business to Lactalis and Sodiaal
September 12 2024 - 7:00AM
Business Wire
General Mills, Inc. (NYSE: GIS) today announced that it has
entered into definitive agreements to sell its North American
Yogurt business to Lactalis and Sodiaal, two leading French dairy
companies, in cash transactions valued at an aggregate $2.1 billion
USD. Following the completion of the transactions, the U.S. and
Canadian businesses will operate independently, with Lactalis
acquiring the U.S. business and Sodiaal acquiring the Canadian
business. The proposed transactions are expected to close in
calendar 2025, subject to receipt of requisite regulatory approvals
and other customary closing conditions.
The divestitures encompass the U.S. and Canada operations of
several yogurt brands including Yoplait, Liberté, Go-Gurt, Oui,
Mountain High, and :ratio, as well as manufacturing facilities in
Murfreesboro, Tenn., Reed City, Mich., and Saint-Hyacinthe, Québec.
Collectively, the North American Yogurt business contributed
approximately $1.5 billion USD to General Mills’ fiscal 2024 net
sales.
“Today’s announcement represents another significant step
forward for General Mills in advancing our Accelerate strategy and
our portfolio reshaping ambitions,” said General Mills Chairman and
Chief Executive Officer Jeff Harmening. “Upon completion of these
divestitures, we will have turned over nearly 30 percent of our net
sales base since fiscal 2018. By efficiently managing our portfolio
and sharpening our focus on our global platforms and local gem
brands that have stronger growth prospects and more attractive
margins, we will be in a better position to drive top-tier
shareholder returns over the long term.”
“We would also like to take this time to thank our North
American Yogurt team members for their significant contributions,”
Harmening continued. “In Lactalis and Sodiaal, we believe we’ve
found the right homes for these businesses, with dairy-focused
owners who are well equipped to drive success for our people and
growth for these brands into the future.”
General Mills anticipates the combined transactions will be
approximately 3 percent dilutive to adjusted earnings per share in
the first 12 months after the close, excluding transaction costs
and other one-time impacts. The company expects to use the net
proceeds from the transactions for share repurchases.
General Mills will provide additional details about the
potential financial impact of the transactions when it reports
first-quarter results on September 18, 2024.
J.P. Morgan served as the exclusive financial adviser to General
Mills for the transactions and Cleary Gottlieb Steen & Hamilton
LLP served as legal adviser.
About General Mills
General Mills makes food the world loves. The company is guided
by its Accelerate strategy to boldly build its brands, relentlessly
innovate, unleash its scale and stand for good. Its portfolio of
beloved brands includes household names like Cheerios, Nature
Valley, Blue Buffalo, Häagen-Dazs, Old El Paso, Pillsbury, Betty
Crocker, Yoplait, Totino’s, Annie’s, Wanchai Ferry, Yoki and more.
General Mills generated fiscal 2024 net sales of U.S. $20 billion.
In addition, the company’s share of non-consolidated joint venture
net sales totaled U.S. $1 billion. For more information, visit
www.generalmills.com.
Cautionary Statement Concerning Forward-Looking
Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995
that are based on our current expectations and assumptions. These
forward-looking statements, including the statements regarding the
proposed transactions and the timing and impact of such
transactions, are subject to certain risks and uncertainties that
could cause actual results to differ materially from the potential
results discussed in the forward-looking statements. In particular,
our predictions about future results could be affected by a variety
of factors, including: disruptions or inefficiencies in the supply
chain; competitive dynamics in the consumer foods industry and the
markets for our products, including new product introductions,
advertising activities, pricing actions, and promotional activities
of our competitors; economic conditions, including changes in
inflation rates, interest rates, tax rates, or the availability of
capital; product development and innovation; consumer acceptance of
new products and product improvements; consumer reaction to pricing
actions and changes in promotion levels; acquisitions or
dispositions of businesses or assets; changes in capital structure;
changes in the legal and regulatory environment, including tax
legislation, labeling and advertising regulations, and litigation;
impairments in the carrying value of goodwill, other intangible
assets, or other long-lived assets, or changes in the useful lives
of other intangible assets; changes in accounting standards and the
impact of critical accounting estimates; product quality and safety
issues, including recalls and product liability; changes in
consumer demand for our products; effectiveness of advertising,
marketing, and promotional programs; changes in consumer behavior,
trends, and preferences, including weight loss trends; consumer
perception of health-related issues, including obesity;
consolidation in the retail environment; changes in purchasing and
inventory levels of significant customers; fluctuations in the cost
and availability of supply chain resources, including raw
materials, packaging, energy, and transportation; effectiveness of
restructuring and cost saving initiatives; volatility in the market
value of derivatives used to manage price risk for certain
commodities; benefit plan expenses due to changes in plan asset
values and discount rates used to determine plan liabilities;
failure or breach of our information technology systems; foreign
economic conditions, including currency rate fluctuations; and
political unrest in foreign markets and economic uncertainty due to
terrorism or war. The company undertakes no obligation to publicly
revise any forward-looking statement to reflect any future events
or circumstances.
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