General Mills to add Annie’s to portfolio

General Mills is in the process of acquiring leading natural and organic food company Annie’s for $46 per share in cash, for a total transaction value of approximately $820 million.



The transaction consideration represents a 51% premium over Annie’s 30-day average closing price of $30.47 as of Sept. 5. Annie’s will continue to be headquartered in Berkeley, California.



“We are excited about this strategic combination, which will enable Annie’s to expand the reach and breadth of our high quality, great tasting organic and natural products, provide new opportunities for our employees, realize greater efficiencies in our operations, and maximize value for our stockholders,” said John Foraker, CEO of Annie’s. “Powerful consumer shifts toward products with simple, organic and natural ingredients from companies that share consumers’ core values show no signs of letting up. 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 stockholders accept General Mills’ offer. General Mills will launch a tender offer within 10 business days to purchase all outstanding shares of Annie’s. 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 in calendar 2014.



“This transaction is a testament to the great team at Annie’s. Together, they have built a highly successful company around the authentic, mission-driven concept that Annie Withey originated 25 years ago,” said Molly Ashby, Annie’s chairperson of the board. “Annie’s is a pioneer of the new generation of company that does well by doing good, generating great value for all stakeholders. This is strategically the right time to pursue this combination because it brings operational, sourcing and distribution capabilities that enable Annie’s to build on its leadership position in the natural and organic market.”



Annie’s financial adviser for the transaction is J.P. Morgan Securities LLC and its legal adviser is Proskauer Rose LLP.