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Pillsbury buy completed
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October 31, 2001: 7:34 p.m. ET
General Mills purchases unit from Diageo for $5.9 billion in revised deal.
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NEW YORK (CNNmoney) - General Mills on Wednesday completed its $5.9 billion buy of Pillsbury from Diageo PLC, ending a 15-month process to acquire the food company.
Revised terms of the deal call for Diageo to receive 134 million shares at $44 each, valuing the transaction at $5.9 billion. The purchase also includes $4.5 billion in cash and assumed debt, totaling $10.4 billion.
Diageo, as part of the deal, may also receive $670 million in whole or in part, 18 months from the close, General Mills said.
Last summer, General Mills Inc. agreed to buy Diageo PLC's Pillsbury unit for $10.5 billion in stock and assumed debt. The Federal Trade Commission on Oct. 23 took no action on the merger, which allowed the purchase to go through.
Diageo (DEO: up $0.10 to $40.85, Research, Estimates) was to receive originally 141 million shares of General Mills shares totaling $5.4 billion in stock. Minneapolis-based General Mills (GIS: up $0.93 to $45.92, Research, Estimates) was also to assume $5.1 billion in debt.
The revised deal includes a standstill provision that precludes Diageo from buying more shares in General Mills for a 20-year period following the close or for three years following the date that Diageo owns less than 5 percent of GM's outstanding shares, whichever is earlier.
As long as Diageo owns 50 percent of the 134 million shares it has received, it can designate two persons to General Mills Board, the company said.
Evercore Partners and Merrill Lynch served as financial advisers to General Mills while UBS Warburg and Green Hill & Co. advised Diageo. 
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