General Mills plans to use all or part of the proceeds from this transaction to repurchase approximately 16.5 million shares of its common stock from Diageo plc, and any remaining proceeds will be used to repay General Mills debt. This share repurchase will be made in conjunction with Diageo's plan to sell approximately 33.4 million additional shares of General Mills stock in an underwritten public offering. Diageo currently holds approximately 79 million General Mills common shares, which it received when General Mills purchased the worldwide Pillsbury operations from Diageo in October 2001. Related to the purchase of preferred interests in General Mills Cereals LLC, Lehman Brothers announced plans to raise $750 million through the issuance of three-year notes that are mandatorily exchangeable into General Mills common stock in October 2007.