The private equity firm PAI had put its 50 per cent share up for auction, attracting approaches from other finance companies and the likes of Nestle, Bel and The Bright Food Company.
But General Mills won the bidding race, signing a deal that PAI revealed was based on a €1.6bn valuation for the whole of Yoplait.
Morning Star analyst Erin Swanson said the €800m price tag for the 50 per cent stake “seems fair”. She added that the deal is especially favourable considering the existing relationship between General Mills and Yoplait.
General Mills has held the license for the Yoplait brand in North America since 1977 so the company had an interest in preventing the stake falling into unfriendly hands.
Analysts had already tipped General Mills as a likely winner because of its ownership of the Yoplait brand in North America. Jon Cox, food analyst at Kepler Capital Markets told DairyReporter.com last month that the US company “has most to lose from not having a friendly party take the stake and as a result it has to be involved.”
Dispute over fee for US license
Swanson said the purchase of the 50 per cent share in Yoplait should have the additional benefit of smoothing over the recent dispute with the other owner Sodiaal.
At the end of last year it emerged that Sodiaal, a French co-operative, was unhappy about the fee General Mills was paying for the US license and threatened to end the deal in 2012. General Mills insisted that renegotiation was not permissible.
Swanson said the Yoplait acquisition should solve this dispute and given how long the companies had been working together before, she doubted that the falling out would be an issue going forward.
Looking to the future, the analyst said the General Mills purchase should enable Yoplait to extend distribution into more faster growing global markets.