No more Yoplait? General Mills says no way

Article by: MIKE HUGHLETT , Star Tribune
Updated: September 10, 2010 - 8:53 PM

A French dairy firm that licenses the name is threatening to end the deal. The Golden Valley company says the agreement stands.

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A French dairy firm that licenses the popular Yoplait trademark to General Mills is trying to terminate its contract, but the Golden Valley-based packaged foods giant says there are no grounds to void the partnership.

Over the past several months, the French company Sodima has expressed its desire to renegotiate the licensing agreement, General Mills said in a Friday filing with securities regulators.

On Sept. 3, General Mills got a letter from the French company "purporting to terminate the (Yoplait) agreement" on Sept. 9, 2012.

But General Mills says the agreement doesn't have language that would allow Sodima to terminate or renegotiate in the current circumstances. "As such, we believe that the agreement remains in full force and effect," General Mills said in the securities filing.

On Tuesday, General Mills filed a petition to arbitrate the dispute with the International Chamber of Commerce's International Court of Arbitration in New York. The company says that through arbitration, it intends to confirm that Sodima can't terminate the Yoplait agreement.

General Mills also said in the securities filing that it's in ongoing discussions with Sodima, "and we remain hopeful that the parties will reach a resolution."

General Mills has licensed the Yoplait trademark for more than 30 years, and the brand is one of its most well-known. In General Mills' most recent fiscal year, its Yoplait division had $1.5 billion in revenue, almost 15 percent of the company's total sales.

The securities filing was made after the stock market closed Friday, with General Mills up 54 cents at $37.19. In after-hours trading, General Mills stock was up a few pennies.

Mike Hughlett • 612-673-7003