General Mills, Minneapolis, agreed to acquire Diageo's Pillsbury Co. for $10.5 billion, as expected. The deal, expected to close by the end of this year, will create a food company with annual sales of $13 billion and a portfolio of powerful brands that will "experience faster growth rates than either company could have achieved separately," said Steve Sanger, General Mills chairman-CEO. General Mills last year saw sales growth of 6%, and Mr. Sanger expects the addition of Pillsbury brands to drive that growth to 7%. General Mills plans to divest Pillsbury's North American dessert mix business, mainly due to antitrust issues raised because of General Mills' existing Betty Crocker business, and the North American Green Giant canned vegetable business. General Mills' agencies include DDB
Worldwide, Chicago; Saatchi & Saatchi, New York; and Campbell Mithun
and Bozell Kamstra, both Minneapolis. Pillsbury shops include Leo Burnett
USA, Chicago; D'Arcy Masius Benton & Bowles, New York; and Dye, Van Mol & Lawrence, Nashville.
Copyright July 2000, Crain Communications Inc.