General Mills is purchasing Tyson Foods’ pet treats division for $1.2 billion as the food giant bulks up its pet-related offerings in an era of increased dog and cat adoption.
The company acquired Blue Buffalo pet foods for $8 billion in 2018.
“Pet food is a high-growth category, fueled by the humanization of pets, a trend that has only increased during the pandemic,” General Mills Pet segment Group President Bethany Quam said in a Friday (May 14) press release. “By adding these trusted pet treat products to our portfolio, we are strengthening our position in this attractive category.”
The business includes the Nudges, Top Chews and True Chews brands of natural meat treats for pets.
According to General Mills, Tyson’s pet portfolio brought in more than $240 million in net sales between April 2020 and April 2021. As part of the deal, General Mills will also acquire a manufacturing facility in Independence, Iowa.
The company, whose brands include everything from Cheerios to Haagen-Dazs to Betty Crocker, will fund the purchase with cash on hand and short-term borrowing.
Pet food sales jumped during the pandemic, initially due to pet owners panic buying food to make sure they had enough for their four-legged family members.
As PYMNTS reported last year, dog food sales rose 54 percent and cat food sales 52 percent in the first week of shutdowns.
But even as people receive COVID vaccinations and businesses resume something akin to normalcy, the pet business is still taking off, with pet care product sales hitting $103 billion in the past year.
American Pet Product Association CEO Steve King said earlier this week in his State of the Industry Report that his organization was “bullish for the coming year,” anticipating 5.8 percent growth, above the historic 3 to 4 percent average.