General Mills Inc. has entered into definitive agreements to sell its North American yogurt business to Lactalis and Sodiaal, two French dairy companies, in cash transactions valued at an aggregate $2.1 billion.
Following the completion, 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 2025, subject to 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, Tennessee, Reed City, Michigan, and Saint-Hyacinthe, Québec. Collectively, the North American Yogurt business contributed about $1.5 billion to General Mills’ fiscal 2024 net sales.
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“Today’s announcement represents another significant step forward for General Mills in advancing our accelerate strategy and our portfolio reshaping ambitions,” said Jeff Harmening, chairman and CEO of Minneapolis-based General Mills.
“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. 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 about 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 Sept. 18.
J.P. Morgan served as the exclusive financial advisor to General Mills for the transactions, while Cleary Gottlieb Steen & Hamilton LLP served as legal adviser.
