Mars Inc. To Acquire Kellanova In $36B Deal

Mars Inc. has shared its intention to acquire Kellanova – home of brands such as Pringles, Cheez-It, Pop-Tarts, Rice Krispies Treats, Kellogg’s (international) and Eggo – for $83.50 per share in cash, for a total consideration of $35.9 billion, including assumed net leverage.

Upon completion of the transaction, Kellanova will become part of Mars Snacking, led by Global President Andrew Clarke and headquartered in Chicago. Mars intends to apply its brand-building approach to grow Kellanova’s brands, including accelerating innovation to meet evolving consumer tastes and preferences, investing locally to expand reach and introducing more better-for-you nutrition options.

“In welcoming Kellanova’s portfolio of growing global brands, we have a substantial opportunity for Mars to further develop a sustainable snacking business that is fit for the future,” said Poul Weihrauch, CEO and office of the president of Mars Inc.

“We will honor the heritage and innovation behind Kellanova’s incredible snacking and food brands while combining our respective strengths to deliver more choice and innovation to consumers and customers. We have tremendous respect for the storied legacy that Kellanova has built and look forward to welcoming the Kellanova team.”

With roots dating back more than 100 years, Kellanova also is the home of brands such as NutriGrain and RXBAR, as well as MorningStar Farms. It had 2023 net sales of more than $13 billion, with a presence in 180 markets and about 23,000 employees.

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Kellanova’s portfolio complements that of Mars, which includes billion-dollar snacking and confectionery brands such as Snickers, M&M’S, Twix, Dove and Extra, as well as Kind and Nature’s Bakery. Mars also has 10 pet care brands with more than $1 billion in sales, including Royal Canin, VCA, Pedigree, Banfield, Whiskas, Bluepearl, Cesar, Sheba, Anicura and IAMS. With more than 150,000 employees across its pet care, snacking and food businesses, Mars had 2023 net sales of more than $50 billion.

“This is a truly historic combination with a compelling cultural and strategic fit. Kellanova has been on a transformation journey to become the world’s best snacking company, and this opportunity to join Mars enables us to accelerate the realization of our full potential and our vision,” said Steve Cahillane, chairman, president and CEO of Kellanova.

Andrew Clarke, global president of Mars Snacking, described it as an “opportunity to create a broader, global snacking business.”

“Kellanova and Mars share long histories of building globally recognized and beloved brands,” he said. “The Kellanova brands significantly expand our snacking platform, allowing us to even more effectively meet consumer needs and drive profitable business growth. Our complementary portfolios, routes-to-market and R&D capabilities will unleash enhanced consumer-centric innovation to shape the future of responsible snacking.”

Transaction details

Under the terms of the agreement, Mars will acquire all outstanding equity of Kellanova for $83.50 per share in cash, representing a total enterprise value of $35.9 billion. All of Kellanova’s brands, assets and operations – including its snacking brands, portfolio of international cereal and noodles, North American plant-based foods and frozen breakfast – are included in the transaction.

Mars intends to fully finance the acquisition through a combination of cash on hand and new debt, for which commitments have been secured.

The agreement has been unanimously approved by the board of directors of Kellanova. The transaction is subject to Kellanova shareholder approval and other customary closing conditions, including regulatory approvals, and is expected to close within the first half of 2025. The transaction agreement permits Kellanova to declare and pay quarterly dividends consistent with historical practice prior to closing.

The W.K. Kellogg Foundation Trust and the Gund Family have entered into agreements pursuant to which they have committed to vote shares representing 20.7 percent of Kellanova’s common stock, as of Aug. 9, in favor of the transaction.

After closing, Battle Creek, Michigan, will remain a core location for the combined organization.