(PEP) - Get Report

will pay $750 million to buy out

General Mills'

(GES) - Get Report

40.5% stake in a joint venture the companies operated selling snack foods in Europe.

General Mills plans to use the money to reduce debt, and will record a gain in 2005. The company affirmed that it still expects to earn $2.75 to $2.80 a share in 2005 before items.

Snack Ventures Europe, which is the continent's biggest snack food company with annual sales of more than $1 billion, will become a wholly owned Pepsi unit when the transaction closes early next year. The company was formed through the July 1992 combination of General Mills' savory snack and sweet biscuit operations in France, Belgium and Holland with Pepsi's salty and sweet snack operations in Spain, Portugal and Greece.

Products marketed by the venture include Bugles, Doritos, Fritos, Lay's and Ruffles.

Pepsi closed regular trading Monday up 49 cents, or 1%, to $51.71, and added another 2 cents after hours. General Mills lost 20 cents, or 1.7%, to $11.95 in regular trading.