Annie's said the strategic combination with General Mills will enable the company to expand the reach and breadth of its natural and organic products.


MINNEAPOLIS — General Mills, Inc. has entered into a definitive agreement to acquire Annie’s, Inc., a producer of branded organic and natural food products, for $46 per share in cash. The proposed transaction has an aggregate value of approximately $820 million.

Berkeley, Calif.-based Annie’s is expected to join General Mills’ U.S. natural and organic products portfolio, which includes the Cascadian Farm, Muir Glen, Larabar and Food Should Taste Good brands. Net sales for these General Mills brands totaled approximately $330 million in fiscal 2014 ended May 25.

“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% compound rate over the last 10 years,” said Jeff Harmening, executive vice-president and chief operating officer of U.S. Retail at General Mills. “Annie’s competes in a number of attractive food categories, with particular strength in convenient meals and snacks — two of General Mills’ priority platforms.  Consumers know and trust Annie’s purpose-driven culture and authentic brand. We believe that combining the Annie’s product portfolio and go-to-market capabilities with General Mills’ supply chain, sales and marketing resources will accelerate the growth of our organic and natural foods business.”

General Mills said it intends to fund the acquisition through available credit, and will launch a tender offer within 10 business days to purchase all outstanding shares of Annie’s.

Annie’s is expected to join General Mills’ U.S. natural and organic products portfolio, which includes the Cascadian Farm, Muir Glen, Larabar and Food Should Taste Good brands.


The board of directors of Annie’s unanimously has recommended that stockholders accept the General Mills offer, noting the acquisition will enable Annie’s to enter a new phase of growth and success while maximizing value for stockholders. The transaction consideration represents a 51% premium over Annie's 30-day average closing price of $30.47 as of Sept. 5, 2014. Annie's headquarters will stay in Berkeley.

“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, chief executive officer 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.”

Mr. Foraker said Annie’s will remain dedicated to its mission: “to cultivate a healthier and happier world by spreading goodness through nourishing foods, honest words and conduct that is considerate and forever kind to the planet. Authentic roots, great tasting products, high quality organic and natural ingredients, and sustainable business practices will continue to be the cornerstones of the Annie’s brand.”

Founded in 1989, Annie’s products are made without artificial flavors, synthetic colors and preservatives regularly used in many conventional packaged foods. Additionally, Annie’s sources ingredients so as to avoid synthetic growth hormones and bioengineered food ingredients. The company offers more than 145 products and is present in more than 35,000 retail locations in the United States and Canada.