Chasing growth

23 February 2018 By Amanda Gomez Follow @alpgomez

The Cheerios maker is throwing an $8 billion bone at the natural-pet-food producer to beef up sales to furry darlings. The prospect of taking over the pantry is as appealing. But to make the investment stack up, General Mills’ new pet will need to grow faster than a puppy.

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General Mills agreed to acquire Blue Buffalo Pet Products for nearly $8 billion including net debt. The U.S. consumer-goods maker will pay $40 per Blue Buffalo share, representing a premium of 17 percent to the pet-food company’s closing price on Feb. 22.

Shareholders representing more than 50 percent of Blue Buffalo’s shares, including its founding family, have approved the transaction, meaning no further vote by the company’s shareholders or directors is needed.

The companies expect $50 million in cost savings over two years.

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