General Mills has finalized the sale of its yogurt businesses in the United States and Canada to Lactalis and Sodiaal, respectively. The total value of these transactions amounts to $2.1 billion, as disclosed by General Mills on September 12.
The company, known for its flagship brand Cheerios, reported that its North American yogurt business accounted for roughly $1.5 billion of its fiscal 2024 net sales. In that fiscal year, General Mills’ total net sales reached $19.9 billion.
As part of the agreement, Lactalis, headquartered in France, will take over General Mills’ US yogurt business, acquiring the rights to the well-known Yoplait and Liberté brands. Meanwhile, Sodiaal, a French dairy cooperative, had previously acquired a 51% stake in Yoplait’s European operations in 2021, trading that interest for complete ownership of the Canadian Yoplait business.
Today, Sodiaal confirmed its agreement with General Mills to purchase the Canadian operations of Yoplait and Liberté. This move underscores Sodiaal’s strategy to strengthen its presence in the food and beverage industry, which continues to evolve with changing consumer trends.
The sale signifies General Mills’ exit from the yogurt market, aligning with their mission to strategically reshape their portfolio. “Today’s announcement represents another significant step forward for General Mills in advancing our Accelerate strategy and our portfolio reshaping ambitions,” stated Jeff Harmening, General Mills’ chairman and CEO. “Upon completion of these divestitures, we will have turned over nearly 30% of our net sales base since fiscal 2018. By managing our portfolio efficiently and focusing on brands with stronger growth prospects and more attractive margins, we aim to enhance top-tier shareholder returns over the long term.”
Following these transactions, General Mills expects to see a dilution of approximately 3% to adjusted earnings per share within the first 12 months post-completion, excluding one-time impacts and transaction costs.
Jean-Michel Javelle, president of Sodiaal, expressed pride in the agreement, emphasizing the return of Yoplait as a part of their cooperative. He noted, “This project confirms the return of Yoplait to the fold of the cooperative, a true national heritage brand that is the pride of our member farmers and our employees. This acquisition strengthens our presence in the world and enhances our French dairy expertise, which is appreciated across the Atlantic.”
Sodiaal has been operational in Canada since 1971 and will now oversee Yoplait’s Canadian functions, which generated an annual revenue of C$500 million ($368 million) as of May 26, 2024. The deal includes a production facility located in Saint-Hyacinthe, Quebec.
Additionally, Lactalis’ acquisition in the US encompasses Mountain High yogurt and various brands sold under license, such as Yoplait, Go-Gurt, Oui, and others. Employees from General Mills’ manufacturing facilities in Murfreesboro, Tennessee, and Reed City, Michigan, as well as personnel from its Minneapolis headquarters, will transition to the Lactalis workforce.
“This acquisition allows us to strengthen our footprint in the US yogurt market,” commented Emmanuel Besnier, chairman of Lactalis. “These iconic brands are a strategic fit that broadens our consumer range and positions us as a key player in the US dairy sector.”
In summary, these significant transactions reflect the dynamic shifts within the food and drink business, driven by emerging consumer trends and strategic corporate decisions. Businesses in the food and beverage industry must continue to adapt and realign with the fast-evolving market demands.
