General Mills has agreed to sell its 51% stake in its European Yoplait operations to French dairy cooperative Sodiaal in exchange for full ownership of the Canadian Yoplait business.

General Mills would acquire Sodiaal’s 49% ownership stake in Yoplait Canada Holding and make it its wholly owned subsidiary.

The Yoplait Canada yoghurt business generated $290m in net sales last year.

The deal also includes a reduced royalty rate for General Mills for use of the Yoplait and Liberté brands in the US and Canada.

The proposed transaction forms part of General Mills’ portfolio reshaping strategy.

Completion of the deal, which is subject to labour consultations, regulatory filings and other customary closing conditions, is expected to close by the end of this year.

Upon completion, General Mills would wholly own yoghurt operations in the US and Canada that generated a combined $1.4bn in net sales last year.

It will also distribute Yoplait and Liberté branded products across the two countries on a royalty-free basis.

General Mills chairman and CEO Jeff Harmening said: “With today’s announcement, we’re taking another step toward advancing our Accelerate strategy and further reshaping our portfolio to drive profitable growth for the long term.

“This transaction improves our growth profile, enhances our margins, and creates value for our shareholders. Additionally, it increases our focus on the brand platforms that have the greatest growth potential.”

Following the completion of the deal, Yoplait would operate yoghurt businesses in the UK, France and few other markets.

It will also manage a network of 28 franchisees manufacturing and distributing Yoplait branded products in more than 40 countries.

General Mills Europe and Australia Group president Dana McNabb said: “This transaction allows us to accelerate our Europe and Australia segment’s growth by increasing our focus on our advantaged global platforms, including Mexican food, super-premium ice cream, and snack bars.

“At the same time, we are pleased to be returning the European Yoplait business to the brand’s original creator and our trusted partner, Sodiaal. The General Mills team will work diligently alongside Sodiaal to ensure a smooth transition as this business enters its next chapter.”