NOTE 10. NONCONTROLLING INTERESTS
Our principal noncontrolling
interest related to our General
Mills Cereals, LLC (GMC)
subsidiary. The
third-party holder of the GMC
Class
A
limited
membership
interests (GMC
Class
A
Interests)
received
quarterly
preferred
distributions
from
available
net
income
based on the
application of a floating
preferred return rate
to the holder’s
capital account balance
established in the
most recent mark-
to-market valuation.
On June 1,
2024, the floating
preferred return
rate was reset
to the sum
of the
three-month Term SOFR
261
basis points.
During the
fourth quarter
of fiscal 2025,
we purchased
the outstanding
GMC Class A
Interests from
the third-party
holder for
$
252.8
million. The purchase
price reflected the
GMC Class A Interests’
original capital account balance
of $
242.3
10.5
primarily
related
to
capital
account
appreciation
attributable
and
paid
to
the
third-party
holder
of
the
Class
A
Interests.
The
capital
appreciation paid to the third-party holder of the Class A Interests was recorded
as a direct reduction to retained earnings, a component
of stockholders’
equity,
on the Consolidated
Balance Sheets, and
reduced net earnings
available to common
stockholders in our
basic
and diluted earnings per share (EPS) calculations.
For
financial
reporting
purposes,
the
assets,
liabilities,
results
of
operations,
and
cash
flows
of
our
non-wholly
owned
consolidated
subsidiaries
are
included
in
our
Consolidated
Financial
Statements.
The
third-party
investor’s
share
of
the
net
earnings
of
these
subsidiaries is reflected in net earnings attributable to noncontrolling
interests in our Consolidated Statements of Earnings.