General Mills executives made the rounds of New York investors and media Wednesday, reiterating the company's growth strategy and dispelling rumors that they are eyeing a large acquisition.
Moments after company representatives rang the opening bell on the New York Stock Exchange, CEO Ken Powell told interviewers on CNBC that General Mills is "kicking the tires on a lot of things constantly" but that it has to see a "clear path to value" in any acquisition that would give shareholders a return on their investment.
"If you want to talk about [mergers and acquisitions] for General Mills, look at what we've done the last five years, extending scale in snacking and organic," Powell said. "We are building on businesses we already have, and that's kind of likely what you'll see from us in the future."
For instance, at the company's annual Investor Day meeting later in the day, Powell pointed to its integration of Annie's Homegrown, a California-based organic brand that General Mills purchased in 2014 for $820 million.
"We're very disciplined when it comes to M&A, and we have to see return on value. Annie's has been a terrific acquisition in that regard for us," Powell said. "Clearly, it's going to be a $1 billion business very soon, and I think it could go to $2 billion."
Powell brushed aside speculation that General Mills may bid for WhiteWave Foods Co., a Denver-based organic foodmaker that last week received a $10 billion purchase offer from Paris-based Danone, a major competitor to General Mills in the yogurt category.
General Mills' yogurt business just closed out a tough fiscal year, losing market share as it struggled to keep up with consumers' changing tastes. In yogurt, "admittedly, we were off our game in 2016," Jeff Harmening, General Mills president, told investors in a largely upbeat presentation.
But both Harmening and Powell elaborated on new yogurt products for this year, the plans for which were unveiled Tuesday. The company will convert its super-premium Liberte yogurt to USDA-certified organic, expand its Annie's organic yogurt from single-serving cartons to larger tubs and portable tubes and introduce a higher-fat version of its Greek whipped product that will be called Yoplait Greek 2% Whips.