General Mills sells North American yogurt business for US$2.1B deal

USA – General Mills has recently finalized the sale of its yogurt businesses in North America to Lactalis and Sodiaal in a deal valued at a total of US$2.1 billion.

The sale represents General Mills’ exit from the yogurt market, aligning with its broader portfolio reshaping strategy aimed at optimizing growth and profitability.

Under the terms of the deal, Lactalis, a major French dairy group, has acquired General Mills’ US yogurt business. 

This includes the well-known Yoplait and Liberté brands, along with Mountain High and other licensed yogurt brands such as Go-Gurt and Oui. 

The acquisition encompassed General Mills’ manufacturing facilities in Murfreesboro, Tennessee, and Reed City, Michigan, as well as its headquarters in Minneapolis, Minnesota. 

According to Lactalis the acquisition is a strategic opportunity to expand its footprint in the US yogurt market. 

Lactalis Chairman Emmanuel Besnier remarked that the addition of these iconic brands will enhance their consumer range and solidify their position as a significant player in the US dairy sector.

On the other side of the Atlantic, Sodiaal, the French dairy cooperative, has acquired General Mills’ 51% controlling interest in the European operations of Yoplait, along with the Canadian Yoplait and Liberté operations. 

This move returns Yoplait to Sodiaal’s portfolio and strengthens its presence in North America. 

Jean-Michel Javelle, President of Sodiaal, expressed pride in resuming operations of Yoplait in Canada, emphasizing the significance of the acquisition for both the cooperative and its member farmers. 

Sodiaal’s Canadian Yoplait business, which includes a production site in Saint-Hyacinthe, Quebec, reported an annual turnover of C$500 million as of late May 2024.

General Mills’ Chairman and CEO, Jeff Harmening, explained that these transactions are part of the company’s Accelerate strategy to focus on core areas with stronger growth prospects. 

He noted that the yogurt business contributed approximately US$1.5 billion to General Mills’ fiscal 2024 net sales, which totaled US$19.9 billion. 

The divestiture of the yogurt segment is expected to be about 3% dilutive to adjusted earnings per share in the first 12 months following the close, excluding transaction costs and other one-time impacts.

Yoplait was started by a group of French dairy farmers in 1964. It partnered with General Mills in 1977 through a franchise agreement giving the maker of Bisquick pancake mix exclusive rights to market the brand in the U.S.

Then in 2011, General Mills acquired a 51% stake worth US$1.2 billion in Yoplait from private equity firm PAI Partners and French dairy cooperative Sodiaal, which retained the remaining stake.

In 2021, General Mills sold the European operations of Yoplait to Sodiaal.

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