Diamond Foods Inc. will restate earnings for the past two yearsand replace its top two executives after the board found thecompany booked payments to walnut growers in the wrong periods. Theshares plunged.

The restatement may imperil Diamond's planned, stock-basedacquisition of the Pringles potato chip brand from Procter &Gamble Co., which has said the sale depended on the favorableresolution of the investigation.

P&G finds the results of the probe “very disappointing,”Paul Fox, a spokesman, said today in an interview. The unit hasattracted “considerable interest” from other potential buyers andthe company will keep all of its options open, he said.