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FTC allows Pillsbury purchase
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October 23, 2001: 6:08 p.m. ET
General Mills gets custody of Pillsbury Dough boy as FTC splits vote.
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NEW YORK (CNNmoney) - The Federal Trade Commission took no action Tuesday on General Mills proposed $5.4 billion acquisition of The Pillsbury Co., settling the fate of the Pillsbury Doughboy.
The regulatory agency considered seeking a preliminary injunction to halt the deal. But the FTC vote on an injunction was split 2-2, so no action was taken.
The FTC will not take any more action, outside of a procedural formality, and the General Mills-Pillsbury merger will go through, an FTC spokesman said. General Mills will also get legal custody of squishy cultural icon, the Pillsbury Doughboy.
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General Mills get Pillsbury Doughboy | |
Last summer, Minneapolis-based General Mills (GIS: up $0.05 to $43.20, Research, Estimates) agreed to buy Diageo PLC's Pillsbury unit, turning the U.S. company into the world's fifth-largest food maker. The deal combines Pillsbury's refrigerated products, Haagen-Dazs ice cream and Old El Paso Mexican food with General Mills' Cheerios and other breakfast cereals, Yoplait and Colombo yogurts, and Betty Crocker cake mixes.
In February, General Mills sold the Pillsbury Co.'s desserts and specialty products business and Robin Hood flour brand to International Multifoods for $305 million in a bid to ease regulatory concerns.
Both companies would use the Pillsbury Doughboy to advertise its products as part of the sale. International Multifoods would use the squishy character to market Pillsbury cakes and cookies, while General Mills would use him to advertise refrigerated tubes of cookie dough and sweet rolls.
In July, CNNmoney.com reported that regulators were considering splitting up custody of the Pillsbury Doughboy. The FTC even considered making General Mills give up the Doughboy completely or having General Mills sell more products to International Multifoods as well as split up use of the icon.
General Mills and International Multifoods said Tuesday they were pleased with the FTC's lack of action. General Mills's purchase of Pillsbury is expected to close in the next few days. 
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