General Mills has Thursday announced that it has entered into definitive agreements to sell its North American yogurt business to Lactalis and Sodiaal, two leading French dairy companies, for $2.1 billion (£1.61bn).
Following the completion of the transactions, the US and Canadian businesses will operate independently, with Lactalis acquiring the US business and Sodiaal acquiring the Canadian business.
The divestitures encompass the US 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.
General Mills chairman and chief executive Jeff Harmening said the deal represents “another significant step forward” in advancing their Accelerate strategy and portfolio reshaping ambitions.
“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,” Harmening said.
Collectively, the North American yogurt business contributed approximately $1.5bn to General Mills’ fiscal 2024 net sales.
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.
The transactions are expected to close in 2025, subject to receipt of requisite regulatory approvals and other customary closing conditions.
