LONDON (Brand Republic) - Diageo, the UK food and drinks company, is understood to be in talks with General Mills, which could result in the sale of its Pillsbury division to the US rival.
According to reports in the US press, Diageo wants to hold on to 25% of its stake in Pillsbury, which manufactures Haagen-Dazs ice cream and Green Giant frozen foods.
The division is valued at between £5.5bn and £6.5bn, and accounts for a third of Diageo鈥檚 sales.
The company indicated last week it could be looking to sell Pillsbury, as shareholders called for an increased focus on its more profitable beers and spirits divisions. Last month it floated a 20% stake of Burger King for $20bn.
Neither company would comment on the reports, and the talks are said to be 鈥渄elicate鈥. Others said to be interested are Heinz and Sara Lee.
The move comes at a time of continuing brand consolidation within the world鈥檚 food industry.
Unilever, which recently bought Bestfoods, is ranked among the top three alongside Nestle and Philip Morris, leaving mid-range companies such as General Mills, Heinz and Diageo to battle for remaining market share and brands.