MINNEAPOLIS -- Any merger of two branded-goods manufacturing companies is likely to present quite a reorganization challenge as the issue of ongoing management of the portfolio is considered.
sales driven by many consumer brands across a wide range of food categories.
Specifically, the addition of Pillsbury's businesses means General Mills now has more than 30 brands, each of which nets U.S. retail sales in excess of $100 million, and many small ones.
Here's a look at how some of the larger brands will be combined into General Mills, and managed.
Major business segments include Big G cereals, the leader in the $7.5 billion U.S. ready-to-eat cereal category, with brands such as Cheerios, Wheaties and Lucky Charms.
The Meals division is focused on convenient dinner options with brands such as Helper casseroles, Betty Crocker potato mixes, Old El Paso Mexican foods, Progresso soups, Green Giant vegetables and meal starters, and Lloyd's refrigerated entrees.
The Pillsbury brand holds a leadership share of the $1.5 billion in the U.S. refrigerated dough category. Other dough-based products include Pillsbury frozen breakfast pastries, Pillsbury frozen waffles and Totino's frozen pizza and snacks.
The Baking Products division offers baking solutions by means of Betty Crocker dessert mixes, Bisquick baking mixes and Gold Medal flour.
In the snack category, leading offerings include Chex Mix snack mix, Fruit Roll-Ups fruit snacks, Pop Secret microwave popcorn and Nature Valley granola bars.
General Mills leads the $2.3 billion U.S. yogurt category with products such as Yoplait, Colombo, Trix yogurt, Yumsters, Go-Gurt and Expresse.
The Health Ventures business includes two organic food brands, Cascadian Farm and Muir Glen, as well as 8th Continent, a soy products joint venture with DuPont.
The acquisition of Pillsbury quadruples the size of General Mills' business in the fast-growing food-service channel.
The Bakeries and Food Service division markets mixes and unbaked, parbaked and fully baked dough products to food-service operators, and retail and wholesale bakeries. The division also includes institutional distribution.
As for international brands, the portfolio includes Pillsbury dough-based products, Betty Crocker mixes, Green Giant vegetables, Old El Paso Mexican foods, Haagen-Dazs ice cream, and a number of local market favorites.
Meanwhile, as an aspect of the merger, General Mills has spun off a number of brands to International Multifoods Corp. for more than $300 million.
The divestiture includes the Hungry Jack, the Martha White and the U.S. Robin Hood brands, in addition to the Pillsbury brand in the desserts and baking mix categories.
Also included are Pet evaporated milk and dry creamer, the Farmhouse of rice and pasta side dishes, and three other flour brands: Softasilk, La Pina and Red Band.
These brands have combined net sales in excess of $500 million.
Moreover, Multifoods is allowed to use the Pillsbury and the Doughboy trademarks on additional baking-related products in the baking goods aisle and is to purchase General Mills' Toledo plant for $11.5 million.
At the conclusion of the deal, Diageo, Pillsbury's London-based parent, exercised its option to sell 55 million previously held General Mills common shares directly to the company at a price of $42.14 per share. Diageo will retain 79 million shares of General Mills common.
General Mills will finance the share repurchase from Diageo with debt, which will add debt of approximately $6.15 billion to General Mills' balance sheet, accounted for by both the share buyback and the Pillsbury acquisition.
