MINNEAPOLIS, MN and BERKELEY, CA
General Mills has agreed to acquire Annie’s, Inc., a natural and organic food producer, for $820 million. Both companies are now partnering to accelerate the growth and development of the Annie’s brand, according to a press release.
“This acquisition will significantly expand our presence in the U.S. branded organic and natural foods industry, where sales have been growing at a 12 percent compound rate over the last 10 years,” said Jeff Hermening, General Mills Executive Vice President and COO.
“Powerful consumer shifts toward products with simple, organic, and natural ingredients from companies that share consumers’ core values show no signs of letting up,” said John Foraker, CEO of Annie’s. “Partnering with a company of General Mills’ scale and resources will strengthen our position at the forefront of this trend, enabling us to more rapidly and efficiently expand into new channels and product lines in a rapidly evolving industry environment.”
The Annie’s Board of Directors has unanimously recommended that Annie’s shareholders accept the offer from General Mills.
Annie’s has grown significantly over the last fiscal year, having $204 million in food sales on over 145 products across 35,000 retail locations. This is due, in part, to the rise in demand for organic and natural foods. Take a look at General Mills’ existing natural and organic products portfolio for instance. Brands which include Cascadian Farm, Muir Glen, LARABAR, and Food Should Taste Good reached net sales of approximately $330 million in the company’s latest fiscal year.
General Mills’ offer will be subject to the tender of a majority of Annie’s shares and to certain other customary closing conditions including regulatory approval. The transaction is expected to close later this year.