RTTNews | May 14, 2021 07:13AM EDT

07:13 Friday, May 14, 2021 (RTTNews.com) - General Mills Inc. (GIS) agreed to buy Tyson Foods' (TSN) pet treats business for $1.2 billion in cash, the companies said in a statement on Friday. The transaction includes the Nudges, Top Chews and True Chews brands.

General Mills noted that the transaction provides an estimated tax benefit of $225 million, equating to an effective purchase price of $975 million.

Tyson Foods' pet treats business and the about 300 team members involved in it will become part of General Mills after the sale is completed.

Tyson Foods' pet treats portfolio generated more than $240 million in net sales in the 12 months ended April 3, 2021. As part of the deal, General Mills will also acquire a manufacturing facility in Independence, Iowa.

General Mills plans to fund the acquisition with cash on hand and short-term borrowing. The transaction is expected to be modestly accretive to General Mills earnings in the first 12 months following completion, excluding transaction and integration expenses.

The company expects the transaction to close in the first quarter of fiscal 2022.

In Friday pre-market trade, GIS was trading at $64.48 up $0.50 or 0.78%. TSN was trading at $80.76 up $0.20 or 0.25%.

Read the original article on RTTNews ( https://www.rttnews.com/3194839/general-mills-to-buy-tyson-foods-pet-treats-business-for-1-2-bln-in-cash.aspx)

For comments and feedback: contact editorial@rttnews.com

Copyright(c) 2021 RTTNews.com All Rights Reserved