General Mills Inc. GIS, -3.59% said Friday it's purchasing pet foods maker Blue Buffalo Inc. BUFF, +17.23% for $40 a share in cash, or roughly $8 billion. General Mills said the deal will immediately add to its net sales growth and operating margin profile, and is expected to be neutral to cash per-share earnings in fiscal 2019. Shares of Blue Buffalo jumped 17% in premarket trade Friday. "The $30 billion U.S. pet food market is generating consistent 3%-4% growth and is highly attractive for retailers," General Mills said in a statement. Blue Buffalo makes natural food and treats for dogs and cats. "The wholesome natural market represents approximately 10% of the pet food market in volume and approximately 20% in value," said General Mills. The deal is expected to close by the end of the General Mills's fiscal 2018.
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