General Mills announces definitive agreement to acquire Brazilian food maker Yoki

General Mills (NYSE: GIS) said today that it has signed a definitive agreement to acquire Yoki Alimentos S.A., a privately-held food company headquartered in São Bernardo do Campo, Brazil. General Mills currently expects the transaction to close during the first half of its 2013 fiscal year, which begins on May 28, 2012, after satisfaction of customary closing conditions.

Yoki is a family-owned Brazilian company established in 1960. Today, its Yoki and Kitano branded products hold leading market positions in several attractive and growing food categories, including snacks (popcorn and snack nuts), convenient meals (side dishes, dry soups), basic foods (grains and beans), and seasonings. Yoki employs more than 5,000 people, and has established a strong operating infrastructure in Brazil, including multiple manufacturing plants and national retail distribution. Yoki reported International Financial Reporting Standards sales of R$1.1 billion for the year ended December 2011.

Chris O’Leary, General Mills’ executive vice president and chief operating officer, International, said, “We are delighted to add Yoki’s talented people and strong brands to General Mills’ growing international business. Yoki adds key capabilities and geographic scale that will accelerate our growth in Brazil. We plan to focus on building the strong Yoki and Kitano product portfolio, expanding our current Haagen-Dazs and Nature Valley businesses in Brazil, and introducing additional General Mills brands in this important market over time.”

Mitsuo Matsunaga, Yoki’s chief executive officer, said, “I am very pleased to see our Yoki brands and businesses joining General Mills. Our family is confident that General Mills’ global capabilities, combined with Yoki’s outstanding employees and brand portfolio, will lead to accelerated growth in Brazil for years to come.”

As one of the biggest and fastest-growing economies in the world, Brazil is an attractive consumer market. A majority of its 200 million people now belong to the middle class and domestic consumption has become an important economic growth driver.

General Mills’ International operations have been growing rapidly in recent years. Fiscal 2012 international segment net sales are expected to exceed US$4 billion, including sales from the Yoplait International yogurt business acquired July 1, 2011. The addition of Yoki will more than double General Mills’ annual sales in Latin America to nearly US$1 billion.

General Mills said that along with the Yoki acquisition, its fiscal 2013 plans include strong cash returns to shareholders.