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Acquisition Between General Mills And Blue Buffalo
- Mar 15, 2018 -

Breakfast cereal producer General Mills (GIS.N) acquired pet food manufacturer Blue Buffalo Pet Products Inc (BUFF.O) for nearly $8 billion to tap into the rapidly growing pet food(This includes dog food, dog treats, dog snacks and dog dental chews) market. In response to the decline in sales of processed foods.

The acquisition announced on Friday made General Mills the latest large food company to seek entry into the $30 billion US pet food market. General Mills is facing the challenge of falling demand for sugary and preservative-containing foods.

"As with human food, consumers are also pursuing more natural and quality doog foods," General Mills executive Jeff Harmening said in a statement.

General Mills will acquire Blue Buffalo for $40 per share, a 17.2% premium to Thursday's closing price.

Blue Buffalo soared 17.2% to $40 on Friday. General Mills fell 3.6% to $52.98.

Analysts said that the transaction was costly. Blue Buffalo's share price has climbed 58% in the past six months