WASHINGTON (AP) -- General Mills' purchase of Pillsbury Co. brings together two 19th century Minneapolis milling companies that will complement each other nicely in the 21st century, business analysts say.
The merger won governmental approval Tuesday when the Federal Trade Commission deadlocked 2-2 on the deal. Without a majority vote against the merger, the deal goes through.
"This brings together some really historic brands -- General Mills' expertise is in dry foods, while Pillsbury's expertise is in refrigerated goods," said John M. McMillin, a food analyst for Prudential Securities in New York. "This allows them to build a more complete packaged-food company."
Pillsbury is the No. 1 producer of refrigerated doughs in the United States. It also makes Green Giant vegetables, Haagen-Dazs ice cream, Old El Paso Mexican foods and Progresso soups.
General Mills is the nation's No. 1 cereal maker, including Cheerios, Lucky Charms, Trix and Wheaties. It also makes Yoplait and Columbo yogurt, Betty Crocker dessert mixes, Hamburger Helper, Bisquik and snacks such as Chex Mix and Pop Secret popcorn.
The new company, with combined annual sales of around $13 billion, will be able to compete more effectively, McMillin said.
"There's an attempt to get bigger, but there's a greater attempt to get better," he said.
Leonard Teitlebaum, a food analyst with Merrill Lynch & Co. in New York, agreed.
"The Pillsbury brands really take General Mills into other areas of the grocery store," he said. "General Mills is a renowned marketing company, arguably the best in the food business."
The FTC split on party lines, with Democrats Sheila Anthony and Mozelle Thompson voting against the merger, and Republicans Orson Swindle and Thomas Leary voting for it.
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