8-K/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K/A

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): April 24, 2018

GENERAL MILLS, INC.

(Exact Name of Registrant as Specified in its Charter)

Delaware	001-01185	41-0274440
(State of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

Number One General Mills Boulevard Minneapolis, Minnesota	55426
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code: (763) 764-7600

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company  ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

Introductory Note

On April 24, 2018, General Mills Inc. (the “Company”) filed with the Securities and Exchange Commission a Current Report on Form 8-K (the “Initial 8-K”) to disclose that it had completed its previously announced acquisition of Blue Buffalo Pet Products, Inc. (“Blue Buffalo”). This Form 8-K/A amends the Initial 8-K to provide the historical audited and unaudited financial statements of Blue Buffalo and the pro forma financial information required by Items 9.01(a) and 9.01(b) of Form 8-K and should be read in conjunction with the Initial 8-K.

Item 9.01 Financial Statements and Exhibits.

(a) Financial Statements of Business Acquired.

The audited consolidated balance sheet of Blue Buffalo as of December 31, 2017, the audited consolidated statements of income, comprehensive income, changes in stockholders’ equity (deficit) and cash flows of Blue Buffalo for the year ended December 31, 2017, the notes related thereto, and the independent auditor’s reports of KPMG LLP relating to the financial statements and internal control over financial reporting of Blue Buffalo are filed as Exhibit 99.1 hereto and are incorporated herein by reference.

The audited consolidated balance sheet of Blue Buffalo as of December 31, 2017, the unaudited condensed consolidated balance sheet of Blue Buffalo as of March 31, 2018, the unaudited condensed consolidated statements of income, comprehensive income, changes in stockholders’ equity and cash flows of Blue Buffalo for the three months ended March 31, 2017 and March 31, 2018, and the notes related thereto are filed as Exhibit 99.2 hereto and are incorporated herein by reference.

(b) Pro Forma Financial Information.

The unaudited pro forma combined statement of earnings of the Company for the fiscal year ended May 27, 2018 and the notes related thereto are filed as Exhibit 99.3 hereto and incorporated herein by reference.

The Company’s Consolidated Balance Sheet as of May 27, 2018 included in the Company’s annual report on Form 10-K that was filed with the Securities and Exchange Commission on June 29, 2018 reflects the acquisition of Blue Buffalo.

(c) Exhibits.

23.1	Consent of Independent Registered Public Accounting Firm for Blue Buffalo.
99.1	Audited Consolidated Balance Sheet of Blue Buffalo as of December  31, 2017, Audited Consolidated Statements of Income, Comprehensive Income, Changes in Stockholders’ Equity (Deficit) and Cash Flows of Blue Buffalo for the year ended December  31, 2017, the Notes related thereto, the Report of Independent Registered Public Accounting Firm relating to the financial statements of Blue Buffalo, and the Report of Independent Registered Public Accounting Firm relating to the internal control over financial reporting of Blue Buffalo (incorporated herein by reference to Part II, Item 8 of the annual report on Form 10-K of Blue Buffalo (File No. 001-37510) filed on February 26, 2018).
99.2	Audited Consolidated Balance Sheet of Blue Buffalo as of December 31, 2017, Unaudited Condensed Consolidated Balance Sheet of Blue Buffalo as of March  31, 2018, Unaudited Condensed Consolidated Statements of Income, Comprehensive Income, and Cash Flows of Blue Buffalo for the three months ended March 31, 2017 and March  31, 2018, Unaudited Condensed Consolidated Statement of Changes in Stockholders’ Equity of Blue Buffalo as of March 31, 2018, and the Notes related thereto.
99.3	Unaudited Pro Forma Combined Statement of Earnings of the Company for the fiscal year ended May 27, 2018 and the Notes related thereto.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: June 29, 2018

GENERAL MILLS, INC.
By:	/s/ Kofi A. Bruce
	Name: Kofi A. Bruce
	Title: Vice President, Controller

EX-23.1

Exhibit 23.1

Consent of Independent Registered Public Accounting Firm

We consent to the incorporation by reference in the registration statements (Nos. 333 198079, 333-202215, 333-219948, and 333-223919) on Form S-3 and the registration statements (Nos. 2-50327, 2-53523, 2-95574, 33-27628, 33-32059, 333-32509, 333-90012, 333-139997, 333-148820, 333-163849, 333-179622, 333-215259, and 333-222589) on Form S-8 of General Mills, Inc. of our reports dated February 26, 2018, with respect to the consolidated balance sheets of Blue Buffalo Pet Products, Inc. as of December 31, 2017 and 2016, and the related consolidated statements of income, comprehensive income, changes in stockholders’ equity (deficit), and cash flows for each of the years in the three-year period ended December 31, 2017, and the related notes (collectively, the “consolidated financial statements”), and the effectiveness of internal control over financial reporting as of December 31, 2017, which reports appear in the Form 8-K/A of General Mills, Inc. dated June 29, 2018.

/s/ KPMG LLP

Stamford, Connecticut

June 29, 2018

EX-99.2

Exhibit 99.2

Blue Buffalo Pet Products, Inc.

Unaudited Condensed Consolidated Balance Sheets

(Dollars In Thousands, Except For Share Data)

	March 31, 2018			December 31, 2017
ASSETS
Current assets:
Cash and cash equivalents	$	288,701		$	282,223
Receivables, net		154,997			150,260
Inventories		103,740			79,945
Prepaid expenses and other current assets		6,160			7,893
Total current assets		553,598			520,321
Restricted cash		781			781
Property, plant and equipment, net		349,963			326,404
Deferred income taxes		98			52
Other assets		1,138			1,028
Total assets	$	905,578		$	848,586
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current maturities of long-term debt	$	4,000		$	4,000
Accounts payable		58,012			63,979
Other current liabilities		79,612			70,994
Total current liabilities		141,624			138,973
Long-term debt		389,066			389,914
Deferred income taxes		14,831			7,095
Other long-term liabilities		13,778			13,468
Total liabilities		559,299			549,450
Commitments and contingencies
Stockholders’ equity:
Preferred stock; $0.01 par value; 150,000,000 shares authorized; none issued or outstanding at March 31, 2018 and December 31, 2017		—			—
Common stock, voting; $0.01 par value; 1,500,000,000 shares authorized; 197,736,083 and 197,615,064 shares issued at March 31, 2018 and December 31, 2017, respectively		1,977			1,976
Additional paid-in capital		82,322			81,113
Retained earnings		311,944			266,221
Accumulated other comprehensive income (loss)		36			(174	)
Treasury stock, at cost; 2,092,744 at March 31, 2018 and December 31, 2017, respectively		(50,000	)		(50,000	)
Total stockholders’ equity		346,279			299,136
Total liabilities and stockholders’ equity	$	905,578		$	848,586

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Blue Buffalo Pet Products, Inc.

Unaudited Condensed Consolidated Statements of Income

(Dollars In Thousands, Except For Share Data)

	Three Months Ended March 31,
	2018			2017
Net sales	$	324,001		$	301,951
Cost of sales		184,735			163,276
Gross profit		139,266			138,675
Selling, general and administrative expenses		77,623			66,188
Operating income		61,643			72,487
Interest expense		1,925			3,206
Interest income		(584	)		(140	)
Other non-operating expense, net		21			123
Income before income taxes		60,281			69,298
Provision for income taxes		14,558			25,208
Net income	$	45,723		$	44,090

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Blue Buffalo Pet Products, Inc.

Unaudited Condensed Consolidated Statements of Comprehensive Income

(Dollars In Thousands)

	Three Months Ended March 31,
	2018		2017
Net income	$	45,723	$	44,090
Other comprehensive income (loss):
Foreign currency translation adjustment		210		(570	)
Other comprehensive income (loss) / no tax		210		(570	)
Comprehensive income	$	45,933	$	43,520

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Blue Buffalo Pet Products, Inc.

Unaudited Condensed Consolidated Statement of Changes in Stockholders’ Equity

(dollars in thousands, except for share amounts)

	Common Stock				Additional paid-in		Retained		Accumulated other comprehensive			Treasury Stock
	Shares		Amount		capital		earnings		(loss) income			Shares		Amount			Total
Balance at December 31, 2017		197,615,064	$	1,976	$	81,113	$	266,221	$	(174	)		2,092,774	$	(50,000	)	$	299,136
Other comprehensive income		—		—		—		—		210			—		—			210
Exercise of stock options		121,019		1		695		—		—			—		—			696
Stock-based compensation expense		—		—		514		—		—			—		—			514
Net income		—		—		—		45,723		—			—		—			45,723
Balance at March 31, 2018		197,736,083	$	1,977	$	82,322	$	311,944	$	36			2,092,774	$	(50,000	)	$	346,279

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Blue Buffalo Pet Products, Inc.

Unaudited Condensed Consolidated Statements of Cash Flows

(Dollars In Thousands)

	Three Months Ended March 31,
	2018			2017
Cash flows from operating activities:
Net income	$	45,723		$	44,090
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		2,697			2,407
Amortization of debt issuance costs		168			30
Stock-based compensation		514			1,290
Loss on disposal of fixed assets		—			384
Deferred income taxes		7,691			2,484
Effect of changes in operating assets and liabilities:
Receivables		(4,617	)		5,461
Inventories		(23,761	)		(9,545	)
Prepaid expenses and other assets		1,729			1,112
Accounts payable		(5,988	)		4,272
Other liabilities		3,530			1,383
Net cash provided by operating activities		27,686			53,368
Cash flows from investing activities:
Capital expenditures		(21,067	)		(8,362	)
Net cash used in investing activities		(21,067	)		(8,362	)
Cash flows from financing activities:
Principal payments on long-term debt		(1,000	)		(990	)
Proceeds from exercise of stock options		695			1,426
Net cash (used in) provided by financing activities		(305	)		436
Effect of exchange rate changes on cash and cash equivalents		164			134
Net increase in cash and cash equivalents		6,478			45,576
Cash and cash equivalents at beginning of period		282,223			292,656
Cash and cash equivalents at end of period	$	288,701		$	338,232
Supplemental schedule of non-cash investing activities:
Accruals related to property, plant and equipment		10,600			—

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Blue Buffalo Pet Products, Inc.

Notes to Unaudited Condensed Consolidated Financial Statements (Continued)

NOTE 1. THE COMPANY

Blue Buffalo Pet Products, Inc. (“BBPP”, and together with its subsidiaries, the “Company,” “we,” “us,” “its,” and “our”) was incorporated in the state of Delaware in July 2012 and conducts its business exclusively through its wholly-owned operating subsidiary, Blue Buffalo Company, Ltd. (“Blue”) (formerly The Blue Buffalo Company, LLC) and its subsidiaries. Blue was formed in August 2002, and is the parent company of six wholly-owned subsidiaries: Great Plains Leasing, LLC, Heartland Pet Food Manufacturing Holding, LLC, Sierra Pet Products, LLC, Blue Buffalo Pet Products Canada, Ltd., Blue Buffalo Japan Kabushiki Kaisha, and Blue Buffalo Pet Food Co., Ltd. Additionally, Blue Buffalo Import Mexico, S. de R.L. de C.V., Blue Buffalo Mexico, S. de R.L. de C.V., Heartland Pet Food Manufacturing, Inc. and Heartland Pet Food Manufacturing Indiana, LLC are indirect wholly-owned subsidiaries of BBPP. BBPP and its subsidiaries develop, produce, market, and sell pet food under the BLUE Life Protection Formula, BLUE Wilderness, BLUE Basics, BLUE Freedom, and BLUE Natural Veterinary Diet lines. Our products are produced domestically at our dry food and treats facilities in Joplin, Missouri and our dry food facility in Richmond, Indiana. Our products are also produced through contract manufacturers for distribution to retailers throughout the United States of America, Canada, Japan, and Mexico.

In July 2012, Blue formed Heartland Pet Food Manufacturing, Inc. (“Heartland”) for the purpose of commencing internal manufacturing operations to eventually supplement its contract manufacturers. Manufacturing operations commenced at our Joplin dry food facility in September 2014. In April 2016, Blue formed Heartland Pet Food Manufacturing Holding, LLC for the purpose of consolidating all manufacturing entities under one holding company. In April 2016, Heartland Pet Food Manufacturing Indiana, LLC was formed for our planned internal manufacturing operations in Richmond, Indiana.

Merger Agreement

Pursuant to an Agreement and Plan of Merger dated February 22, 2018 (the “Merger Agreement”) among the Company, General Mills Inc., a Delaware corporation (“General Mills”), and Bravo Merger Corp., a Delaware corporation and a wholly-owned subsidiary of General Mills (“Merger Sub”), Merger Sub merged with and into the Company (the “Merger”), with the Company surviving the Merger as a wholly-owned subsidiary of General Mills. The Merger became effective on April 24, 2018 (the “Effective Time”).

At the Effective Time, in accordance with the Merger Agreement, among other things, (i) each issued and outstanding share of common stock of the Company, par value $0.01 per share (the “Common Stock”), was converted into the right to receive $40.00 in cash, without interest (the “Merger Consideration”), other than shares of Common Stock held by General Mills, Merger Sub or any other wholly-owned subsidiary of General Mills, shares of Common Stock owned by the Company (including shares held in treasury) or any of its wholly-owned subsidiaries, and shares of Common Stock owned by stockholders who have properly exercised and perfected appraisal rights under Delaware law, (ii) each option to acquire shares of Common Stock (“Stock Option”), whether vested or unvested, that was outstanding immediately prior to the Effective Time was cancelled automatically and only entitles the holder of such Stock Option to receive, without interest, an amount in cash equal to the product of (x) the total number of shares of Common Stock subject to such Stock Option multiplied by (y) the excess, if any, of the Merger Consideration over the exercise price of such Stock Option, less applicable tax withholding and (iii) each restricted stock unit of the Company outstanding immediately prior to the Effective Time, whether vested or unvested, was automatically cancelled and only entitles the holder thereof to receive, without interest, an amount in cash equal to the product of (x) the total number of shares of Common Stock subject to the restricted stock unit multiplied by (y) the Merger Consideration, less applicable tax withholding. Immediately prior to the Effective Time, the holding restrictions applicable to each share of restricted stock of the Company outstanding immediately prior to the Effective Time automatically expired and each such share of restricted stock was converted into the right to receive the Merger Consideration.

Blue Buffalo Pet Products, Inc.

Notes to Unaudited Condensed Consolidated Financial Statements (Continued)

On April 24, 2018, in connection with the consummation of the Merger, the Company (i) notified the NASDAQ Global Select Market (“NASDAQ”) of the consummation of the Merger and (ii) requested that NASDAQ (x) suspend trading of the shares of Common Stock effective on April 24, 2018, and (y) file with the SEC a Form 25 Notification of Removal from Listing and/or Registration (“Form 25”) to delist and deregister the shares of Common Stock under Section 12(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). In accordance with the Company’s request, NASDAQ filed a Form 25 on April 24, 2018 to provide notification of such delisting and to effect the deregistration of the shares of Common Stock under Section 12(b) of the Exchange Act. On May 4, 2018, the Company filed with the SEC a Form 15 requesting that the shares of Common Stock be deregistered and that the Company’s reporting obligations under Sections 13 and 15(d) of the Exchange Act be terminated.

The Company has evaluated subsequent events through June 12, 2018, the date on which the condensed consolidated financial statements were available to be issued, with no such events being identified, with the exception of those events related to the Merger Agreement as discussed above.

NOTE 2. BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements include the accounts of BBPP and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

The unaudited condensed consolidated financial statements reflect all normal recurring adjustments which, in management’s opinion, are necessary for a fair statement of the results for interim periods. Results of operations for interim periods may not be representative of results to be expected for a full year. Certain prior period amounts have been reclassified to conform to the current period presentation.

Certain information and footnote disclosure normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s annual consolidated financial statements and related notes for the year ended December 31, 2017, included in BBPP’s Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 26, 2018 and amended on April 23, 2018.

Net sales for all periods in the unaudited condensed consolidated statements of income are presented in accordance with Accounting Standards Codification 605, Revenue Recognition.

NOTE 3. INVENTORIES

Inventories consisted of the following:

In Thousands	March 31, 2018		December 31, 2017
Finished goods	$	98,992	$	76,606
Work in process		156		213
Raw materials		2,938		2,104
Packaging and supplies		1,654		1,022
Total	$	103,740	$	79,945

As of March 31, 2018 and December 31, 2017, our inventory reserves were primarily for excess finished goods and packaging which totaled $5.2 million and $5.1 million, respectively.

Blue Buffalo Pet Products, Inc.

Notes to Unaudited Condensed Consolidated Financial Statements (Continued)

NOTE 4. PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment consisted of the following:

In Thousands	March 31, 2018			December 31, 2017
Buildings	$	74,563		$	59,314
Machinery and equipment		65,254			52,383
Computer software		18,302			17,635
Computer equipment		4,899			4,855
Furniture and fixtures		1,916			1,876
Leasehold improvements		1,603			1,590
Land improvements		493			493
Land		430			395
Buildings improvements		870			613
Construction in progress		216,315			219,234
	384,645			358,388
Accumulated depreciation and amortization		(34,682	)		(31,984	)
Total	$	349,963		$	326,404

Depreciation and amortization expense was approximately $2.7 million and $2.4 million for the three months ended March 31, 2018 and 2017, respectively.

In August 2016, Heartland and the City of Joplin, Missouri (“Joplin”), entered into agreements by which Joplin agreed to issue up to an aggregate principal amount of approximately $83.3 million of industrial revenue bonds to purchase from Heartland the land in Joplin on which our dry food facility resides and on which our treats facility has since been built, and the associated buildings, structures, and fixtures, including the additional manufacturing equipment included in the treats facility (collectively, the “Property”), which will then be leased back to Heartland. As Heartland will become the owner of the Property at the end of the lease term, the lease meets the requirements of a capital lease and the equipment and land are recorded as property, plant and equipment on our balance sheets. The Company has the right and intends to set-off any obligation to make payments under the lease agreement with the amounts due under the industrial revenue bonds. As of March 31, 2018, Joplin had issued and Heartland had purchased approximately $31.9 million of industrial revenue bonds and Joplin had purchased from, and leased back to, Heartland the Property for a corresponding amount.

Blue Buffalo Pet Products, Inc.

Notes to Unaudited Condensed Consolidated Financial Statements (Continued)

NOTE 5. LONG-TERM DEBT

Long-term debt consisted of the following:

In Thousands	March 31, 2018			December 31, 2017
Term loan	$	393,066		$	393,914
Less current maturities		(4,000	)		(4,000	)
Total long-term debt	$	389,066		$	389,914

At March 31, 2018, the Company had $393.1 million of term loan borrowings (fair value of $393.3 million) at an effective interest rate of 3.89% and no outstanding borrowings under the revolving credit facility. At December 31, 2017, the Company had $393.9 million of term loan borrowings (fair value of $395.4 million) at an effective interest rate of 3.72% and no outstanding borrowings under the revolving credit facility. As of March 31, 2018, the Company was in compliance with its financial debt covenants.

Termination of the Credit Agreement

In connection with the consummation of the Merger, on April 24, 2018, the Company terminated the Credit Agreement, dated as of May 25, 2017 (the “Credit Agreement”), by and among the Company, Citibank, N.A., as the administrative agent, and the lenders and other parties thereto. The Company paid an aggregate amount of approximately $398 million in satisfaction of all of its outstanding obligations under the Credit Agreement.

NOTE 6. STOCK-BASED COMPENSATION

Stock Options

The Company uses the Black-Scholes option-pricing model to determine the fair value of stock options on the date of grant. Stock options granted under the 2012 plan are subject to pro-rata vesting and grants under the 2015 Plan are subject to cliff vesting. The fair value of stock options is expensed on a straight-line basis over the vesting period.

There were no grants issued during the three months ended March 31, 2018.

The following table summarizes stock option activity during the three months ended March 31, 2018 and also presents stock options outstanding and exercisable as of March 31, 2018:

	Number of Shares			Weighted Average Exercise Price Per Share
Options outstanding at December 31, 2017		3,416,533		$	9.09
Granted		—			—
Exercised		(121,019	)		5.70
Forfeited		(28,033	)		24.01
Expired		—			—
Options outstanding at March 31, 2018		3,267,481		$	9.09

Blue Buffalo Pet Products, Inc.

Notes to Unaudited Condensed Consolidated Financial Statements (Continued)

Restricted Stock Units

No restricted stock units (RSUs) were granted during the three months ended March 31, 2018.

The following table summarizes RSU activity for the three months ended March 31, 2018:

	RSUs
	Number of Shares			Weighted Average Grant Date Fair Value
Outstanding at December 31, 2017		157,792		$	23.86
Granted		—			—
Vested		—			—
Forfeited		(9,532	)		24.02
Outstanding at March 31, 2018		148,260		$	23.83

Stock-based Compensation Expense

Stock-based compensation costs charged to operations (as a component of selling, general, and administrative expenses) during the three months ended March 31, 2018 and 2017 was approximately $0.5 million and $1.3 million, respectively.

Settlement of Stock Options and RSUs in the Merger

At the Effective Time of the Merger, each outstanding Stock Option and RSU was cancelled and settled as described in Note 1. The total value of all Stock Options and RSUs cancelled and settled in cash was approximately $105.8 million.

EX-99.3

Exhibit 99.3

Unaudited Pro Forma Combined Financial Information

On April 24, 2018, General Mills, Inc. (“General Mills”) completed its acquisition of Blue Buffalo Pet Products, Inc. (“Blue Buffalo”). The following unaudited pro forma combined financial information gives pro forma effect to the acquisition of Blue Buffalo and related transactions as if they had occurred on May 29, 2017 and is provided for informational purposes only. The unaudited pro forma combined financial information was based on and should be read in conjunction with the (i) consolidated financial statements of General Mills included in its Annual Report on Form 10-K for the year ended May 27, 2018; (ii) consolidated financial statements of Blue Buffalo included in its Annual Report on Form 10-K for the year ended December 31, 2017, incorporated by reference herein; (iii) the unaudited condensed consolidated financial statements of Blue Buffalo included in its Quarterly Report on Form 10-Q for the quarter ended March 31, 2017; and (iv) the unaudited condensed consolidated financial statements of Blue Buffalo as of and for the quarter ended March 31, 2018, which are included in Exhibit 99.2 to this Form 8-K/A.

General Mills’ fiscal year ended on May 27, 2018 and Blue Buffalo’s fiscal year ended on December 31, 2017. The Unaudited Pro Forma Combined Statement of Earnings combines General Mills’ results for the fiscal year ended May 27, 2018 with Blue Buffalo’s results for the fiscal year ended December 31, 2017. Blue Buffalo’s results were adjusted to exclude the results for the three months ended March 31, 2017 and include the results for the three months ended March 31, 2018. The fiscal year post-acquisition for Blue Buffalo as a consolidated subsidiary of General Mills will be May 1 to April 30.

The historical financial information has been adjusted to give effect to pro forma events that are directly attributable to the acquisition, are factually supportable and are expected to have a continuing impact on the combined results. The unaudited pro forma combined financial information should be read in conjunction with the accompanying notes to the Unaudited Pro Forma Combined Statement of Earnings and is not necessarily indicative of the combined results of operation or financial condition had the acquisition been completed at the beginning of the fiscal year. In addition, the unaudited pro forma combined financial information does not purport to project the future results of operations or financial position of the combined company.

Unaudited Pro Forma Combined Statement of Earnings

GENERAL MILLS, INC. AND SUBSIDIARIES

For the year ended May 27, 2018

(In Millions, Except per Share Data)

	General Mills		Blue Buffalo		Pro Forma Adjustments			See Note 3	Pro Forma Combined
Net sales	$	15,740.4	$	1,296.6	$	—			$	17,037.0
Cost of sales		10,312.9		706.9		6.7		(a)		11,026.5
Selling, general, and administrative expenses		2,752.6		297.4		(30.5	)	(b) (c)		3,019.5
Restructuring, impairment, and other exit costs		165.6		—		—				165.6
Operating profit		2,509.3		292.3		23.8				2,825.4
Interest, net		373.7		7.9		147.1		(d)		528.7
Other non-operating expense, net		—		0.1		(0.1	)	(d)		—
Earnings before income taxes and after-tax earnings from joint ventures		2,135.6		284.3		(123.2	)			2,296.7
Income taxes		57.3		89.2		(41.9	)	(e)		104.6
After-tax earnings from joint ventures		84.7		—		—				84.7
Net earnings, including earnings attributable to redeemable and noncontrolling interests		2,163.0		195.1		(81.3	)			2,276.8
Net earnings attributable to redeemable and noncontrolling interests		32.0		—		—				32.0
Net earnings attributable to General Mills	$	2,131.0		195.1		(81.3	)		$	2,244.8
Earnings per share—basic	$	3.69							$	3.77
Earnings per share—diluted	$	3.64							$	3.71
Dividends per share	$	1.96							$	1.96

See accompanying notes to the Unaudited Pro Forma Combined Statement of Earnings.

Notes to Unaudited Pro Forma Combined Statement of Earnings

GENERAL MILLS, INC. AND SUBSIDIARIES

NOTE 1. BASIS OF PRESENTATION

The unaudited pro forma combined financial information was based on and should be read in conjunction with the (i) consolidated financial statements of General Mills, Inc. (“General Mills”) included in its Annual Report on Form 10-K for the year ended May 27, 2018; (ii) consolidated financial statements of Blue Buffalo Pet Products, Inc. (“Blue Buffalo”) included in its Annual Report on Form 10-K for the year ended December 31, 2017, incorporated by reference herein; (iii) the unaudited condensed consolidated financial statements of Blue Buffalo included in its Quarterly Report on Form 10-Q for the quarter ended March 31, 2017; and (iv) the unaudited condensed consolidated financial statements of Blue Buffalo as of and for the quarter ended March 31, 2018, which are included in Exhibit 99.2.

General Mills’ fiscal year ended on May 27, 2018 and Blue Buffalo’s fiscal year ended on December 31, 2017. The Unaudited Pro Forma Combined Statement of Earnings combines General Mills’ results for the fiscal year ended May 27, 2018 with Blue Buffalo’s results for the fiscal year ended December 31, 2017. Blue Buffalo’s results were adjusted to exclude the results for the three months ended March 31, 2017 and include the results for the three months ended March 31, 2018 as follows:

	Blue Buffalo
	Year Ended December 31, 2017 (audited) (A)		Three Months Ended March 31, 2018 (unaudited) (B)		Three Months Ended March 31, 2017 (unaudited) (C)		Year Ended March 31, 2018 (unaudited) (A+B-C)
Net sales	$	1,274.6	$	324.0	$	302.0	$	1,296.6
Cost of sales		685.5		184.7		163.3		706.9
Selling, general, and administrative expenses		285.9		77.7		66.2		297.4
Operating profit		303.2		61.6		72.5		292.3
Interest, net		9.7		1.3		3.1		7.9
Other non-operating expense, net		0.2		—		0.1		0.1
Earnings before income taxes		293.3		60.3		69.3		284.3
Income taxes		99.8		14.6		25.2		89.2
Net earnings	$	193.5	$	45.7	$	44.1	$	195.1

The unaudited pro forma combined financial information should be read in conjunction with the accompanying notes to the Unaudited Pro Forma Combined Statement of Earnings and is not necessarily indicative of the combined results of operation or financial condition had the acquisition been completed at the beginning of the fiscal year. The unaudited pro forma combined financial information does not reflect any cost savings. The unaudited pro forma combined financial information does not purport to project the future results of operations or financial position of the combined company.

NOTE 2. PURCHASE CONSIDERATION

The unaudited pro forma combined information reflects the acquisition of Blue Buffalo for a purchase price of $8.0 billion, including $103.0 million of consideration for net debt repaid at the time of acquisition.

The acquired assets and assumed liabilities include the following:

Assets (Liabilities), In Millions
Receivables	$	128.9
Inventories		176.5
Prepaid expenses and other current assets		4.8
Land, buildings, and equipment		359.2
Goodwill		5,294.9
Other intangible assets		3,015.0
Other assets		1.7
Accounts payable		(55.1	)
Other current liabilities		(62.2	)
Deferred income taxes		(750.2	)
Other liabilities		(77.7	)
Total assets acquired and liabilities assumed	$	8,035.8

NOTE 3. PRO FORMA ADJUSTMENTS

The following items resulted in adjustments reflected in the Unaudited Pro Forma Combined Statement of Earnings:

(a) Blue Buffalo’s historical method for inventory valuation was the lower of cost, using the first-in, first-out (FIFO) method, or net realizable value. General Mills’ financial results reflect inventory valuation at the lower of cost, using the last-in, first-out (LIFO) method, or market for all inventories in the United States other than grain. The Unaudited Pro Forma Combined Statement of Earnings was adjusted to increase cost of sales by $6.7 million to reflect the impact of using the LIFO method of inventory valuation on Blue Buffalo’s historical operating results. Blue Buffalo will use the LIFO valuation method for inventory beginning in fiscal 2019.

(b) During the year ended May 27, 2018, General Mills recorded acquisition transaction and integration costs of $34.0 million in selling, general and administrative (SG&A) expenses. The Unaudited Pro Forma Combined Statement of Earnings was adjusted to exclude these costs as such costs are non-recurring and directly attributable to the acquisition.

During the year ended March 31, 2018, Blue Buffalo recorded acquisition transaction costs of $10.0 million in SG&A expenses. The Unaudited Pro Forma Combined Statement of Earnings was adjusted to exclude these costs as such costs are non-recurring and directly attributable to the acquisition.

(c) Other intangible assets includes an amortizing intangible asset of $269.0 million related to customer relationships. An adjustment to the Unaudited Pro Forma Combined Statement of Earnings of $13.5 million was made to increase amortization expense related to this intangible asset.

(d) Debt and interest, net—In April 2018, we issued fixed-rate and floating-rate notes with varying maturities in an aggregate principal amount of $6.0 billion (the “April Notes”). The net proceeds were used to finance a portion of the Blue Buffalo acquisition.

The principal amounts of these fixed-rate and floating-rate notes were as follows:

In Millions	Principal
4.2% notes due April 17, 2028	$	1,400.0
Floating-rate notes due April 16, 2021		850.0
3.7% notes due October 17, 2023		850.0
4.0% notes due April 17, 2025		800.0
4.7% notes due April 17, 2048		650.0
3.2% notes due April 16, 2021		600.0
4.55% notes due April 17, 2038		500.0
Floating-rate notes due October 17, 2023		400.0
Total	$	6,050.0

The pro forma adjustment for interest, net included in the Unaudited Pro Forma Combined Statement of Earnings was calculated based on the aggregate $6.0 billion principal amount of the April Notes. The pro forma adjustment for interest, net was calculated using an assumed weighted-average interest rate of 3.85 percent and includes the amortization of debt discounts and issuance costs. The pro forma adjustment includes $211.6 million of incremental interest expense to reflect acquisition debt financing for the full fiscal year.

In February 2018, we entered into a fee-paid commitment letter with certain lenders, pursuant to which such lenders committed to provide a 364-day senior unsecured bridge term loan credit facility (the “Bridge Facility”) in an aggregate principal amount of up to $8.5 billion to provide the financing for the acquisition of Blue Buffalo. The Bridge Facility expired in the fourth quarter of fiscal 2018, and we recorded $36.1 million of lender and professional fees related to the Bridge Facility. Additionally, we recorded $13.8 million in interest, net related to the repurchase of certain medium term notes. The pro forma adjustment includes a $49.9 million reduction to interest, net related to these items.

Blue Buffalo’s outstanding debt was repaid at the time of acquisition. Interest, net was reduced by $14.7 million to reflect the elimination of interest expense on Blue Buffalo’s extinguished debt, which included amortization of debt issuance costs. Additionally, we reclassified $0.1 million from other non-operating expense, net to interest, net to conform Blue Buffalo’s historical financial statement presentation to General Mills’ financial statement presentation.

(e) Income taxes—Income tax expense was recalculated based on the Pro Forma Adjustments and the statutory rate in effect at the time of the acquisition.

NOTE 4. EARNINGS PER SHARE

On March 27, 2018, we issued 22.7 million shares of the Company’s common stock, par value $0.10 per share, at a public offering price of $44.00 per share for total proceeds of $1.0 billion. Proceeds of $969.9 million, net of $30.1 million of issuance costs, were used to finance a portion of the Blue Buffalo acquisition. The issuance costs were recorded in additional paid in capital on the consolidated balance sheets.

Basic and diluted EPS were calculated using the following:

In Millions, Except per Share Data	Year Ended May 27, 2018
Net earnings attributable to General Mills	$	2,244.8
Average number of common shares—basic EPS		596.1
Incremental share effect from: (a)
Stock options		6.9
Restricted stock, restricted stock units, and other		2.0
Average number of common shares—diluted EPS		605.0
Earnings per share—basic	$	3.77
Earnings per share—diluted	$	3.71

(a) Incremental shares from stock options, restricted stock units, and performance share units are computed by the treasury stock method. Stock options, restricted stock units, and performance share units excluded from our computation of diluted EPS because they were not dilutive were as follows:

In Millions	2018
Anti-dilutive stock options, restricted stock units, and performance share units		8.9

NOTE 5. NONRECURRING COSTS TO BE RECOGNIZED IN THE NEXT FISCAL YEAR

Nonrecurring charges resulting directly from the acquisition, consisting of integration costs and inventory fair value adjustments, will be recognized in the year ending May 26, 2019. These charges amount to approximately $68 million, net of a related tax benefit of approximately $20 million, and are not included in the Unaudited Combined Pro Forma Statement of Earnings.