Annie’s (BNNY) to be Acquired by General Mills
Shares of Annie's Inc. (BNNY) were up +12.34 or +36.82 percent to $45.85 per share in premarket trading on Tuesday after news that food mega corporation General Mills (GIS) would be taking over the company for $820 million. Annie's Inc. stock closed at $33.51, down -0.38 or -1.12 percent in Monday's regular trading session.
Berkeley, California based Annie's Inc. was originally founded as Annie's Homegrown in Hampton, Connecticut in 1989.
Golden Valley, Minnesota based General Mills was founded in 1866 and is a Fortune 500 company and S&P 500 component involved in food processing and production. The company's brand portfolio includes more than 90 leading U.S. brands and markets its most popular products under brand names such as Betty Crocker, Cheerios, Columbo, Green Giant, Haagen Dazs, Lucky Charms, Pillsbury and Trix to name just a few.
The takeover announced yesterday after the market close, will have General Mills pay $46 in cash per Annie's share and represents a 51 percent premium over the stock's closing price of $33.51. The deal will be financed by General Mills through borrowing with the company initiating the tender offer within 10 days. The acquisition is subject to regulatory approval and to the majority of Annie's shares being tendered. The deal is expected to close later this year.
General Mills' Executive Vice President and Chief Operating Officer, Jeff Harmening said that, "Consumers know and trust Annie's purpose-driven culture and authentic brand, he continued, "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 percent compound rate over the last 10 years, Annie's competes in a number of attractive food categories, with particular strength in convenient meals and snacks - two of General Mills' priority platforms.
Annie's board of directors unanimously approved the sale. The company stated that it would continue to stay true to its commitment to producing healthy food and its environmentally conscious business model, with Annie's to retain its headquarters in Berkeley, California.
Annie's Chief Executive Officer, John Foraker stated on the company's Facebook (FB) page that, "We are thrilled because this opportunity will fuel Annie's future growth and allow us to more rapidly expand our line of high quality, great tasting products made with organic and natural ingredients that you've come to love over the last 25 years,
The takeover announcement drew considerable heat among Annie's fans on their Facebook page, with Annie's proponents dismayed over the fact that Annie's has supported California's efforts to label genetically modified foods, while General Mills - who uses GMOs in its products - has been opposed to labeling efforts.
Annie's stock is reacting favorably to the news, trading just shy of the takeover price in premarket trading this morning. The deal is still subject to regulatory approval, but appears that the acquisition will ultimately go through.
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Annie's Reports First Quarter Financial Results, Reaffirms Full Year Guidance
Annie's announces net loss of -$0.07 for the first quarter.
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