General Mills is spending $1.45 billion to add more pet food to its portfolio, the Golden Valley-based company announced Thursday.
The maker of Blue Buffalo signed a deal with the Belgian owner of Whitebridge Pet Brands to acquire Tiki Pets, Cloud Star and other top-shelf pet food and treat brands.
"These brands complement our Blue Buffalo portfolio and will help us incrementally grow in cat feeding and treats," Jon Nudi, president of North America pet for General Mills, said in a statement.
Whitebridge calls itself a "leader in natural health nutrition for pets," and General Mills considers the brands "premium," like Blue Buffalo — able to demand a higher price from consumers.
Whitebridge had $325 million in revenue over the past year. The sale is expected to close early in 2025, and General Mills doesn't plan to rebrand the new additions as Blue Buffalo products.
The acquisition comes even as pet treats have held back growth for the company's $2.3 billion pet business due to inflation and changing pet parent habits. The Whitebridge deal indicates General Mills still believes the category is headed in the right direction long term.
Nudi said the move "strengthens our commitment in the pet space."
Adding more cat food to a dog-heavy portfolio should help the company capture more pet parent spending; about a third of U.S. households have a cat, and they seem to be splurging more than dog owners.
"Dog owners spent less overall on their pets this year compared to 2023, while cat owners spent slightly more than they did in 2023," reports the American Veterinary Medical Association.
General Mills will pick up two new manufacturing facilities in Missouri as part of the deal paid for with cash and new debt.
The company signaled this fall that it wanted to pay up to $2 billion for a "bolt-on" acquisition to boost its business after announcing the $2.1 billion sale of Yoplait. Since General Mills bought Blue Buffalo in 2018, it has made four more pet acquisitions, including European brand Edgard & Cooper this year.
Former General Mills exec David Clark called the Whitebridge acquisition a "swap" from the slow-growing yogurt brand to "a more synergistic, growth-focused portfolio."
"If your business model depends on feeding more humans, you're in trouble," Clark wrote on LinkedIn. "Around the world, people are having fewer children, but many are offsetting this by adding more pets. Expanding in pet food gives General Mills access to a growing market to help counterbalance the population headwinds."
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