Food company General Mills (GIS) announced Tuesday that it has entered into a memorandum of understanding to sell its 51 percent controlling interest in Yoplait S.A.S. to French dairy cooperative Sodiaal, in exchange for full ownership of the Canadian Yoplait business and a reduced royalty rate for use of the Yoplait and Liberté brands in the U.S. and Canada.
The proposed transaction is expected to close by the end of calendar 2021, subject to appropriate labor consultations, regulatory filings, and other customary closing conditions.
Following completion of the transaction, Yoplait S.A.S. would operate yogurt businesses in France, the United Kingdom, and certain other markets, and manage a network of 28 franchisees manufacturing and distributing Yoplait branded products in more than 40 countries around the world.
Meanwhile, General Mills would acquire Sodiaal’s 49 percent ownership interest in Yoplait Canada Holding Co., making the Yoplait Canada yogurt business a wholly owned subsidiary of General Mills.
Following completion of the transaction, General Mills would wholly own yogurt operations in the U.S. and Canada. It will also distribute Yoplait and Liberté branded products in the U.S. and Canada on a royalty-free basis.
For General Mills, this transaction improves its growth profile, enhances margins, and creates value for its shareholders. It also allows them to accelerate their Europe & Australia segment’s growth by increasing focus on advantaged global platforms, including Mexican food, super-premium ice cream, and snack bars.
Source: Read Full Article