Snap, crackle and pay: Ferrero to buy WK Kellogg for $3.1 bn

Iconic US cereal shaper WK Kellogg has reached a woody to merchantability itself to Italian nutrient institution Ferrero for $3.1 bn. Photo: Brandon Bell / GETTY IMAGES NORTH AMERICA/Getty Images via AFP/File
Source: AFP

The Ferrero Group volition get US cereal mainstay WK Kellogg for $3.1 cardinal arsenic the Italian nutrient elephantine expands further successful North America, the companies announced Thursday.

Ferrero, whose products see Nutella cocoa dispersed and Ferrero Rocher cocoa treats, volition wage $23 per stock successful currency for WK Kellogg, which is known for Rice Krispies and Kellogg's Frosted Flakes, among different offerings.

The transaction is expected to adjacent successful the 2nd fractional of 2025, said a associated property release. On completion of the transaction, WK Kellogg volition beryllium a wholly owned subsidiary of Ferrero.

The pricing of Kellogg represents a 31 percent premium to the company's closing terms connected Wednesday.

Ferrero Chief Executive Giovanni Ferrero described the merger arsenic "the coming unneurotic of 2 companies" with "generations of loyal consumers."

"Over caller years, Ferrero has expanded its beingness successful North America," said Giovanni Ferrero. "Today's quality is simply a cardinal milestone successful that journey, giving america assurance successful the opportunities ahead."  

Ferrero, whose origins stem from its founding successful Alba, Italy successful 1946, has struck a fig of deals successful caller years to grow successful North America, including the 2018 acquisition of Nestle's US confectionary business for $2.8 cardinal successful cash.

Prior to the Kellogg deal, Ferrero had much than 14,000 employes crossed 22 plants and 11 offices successful North America, according to the property release. Its US brands see Keebler, Famous Amos and Tic Tac.

WK Kellogg is the cereal limb of Michigan-based Kellogg, which divided itself up a mates of years ago, with its Kellanova snack marque being sold to Mars successful August 2024 for astir $36 billion.

"We judge this projected transaction maximizes worth for our stock owners and enables WK Kellogg Co to constitute the adjacent section of our company's storied legacy," said Gary Pilnick, main enforcement of WK Kellogg.

"Joining Ferrero volition supply WK Kellogg Co with greater resources and much flexibility to turn our iconic brands successful this competitory and dynamic market."

Kellogg dates its origins to 1894 erstwhile laminitis WK Kellogg invented the Corn Flakes cereal, the archetypal of a bid of offerings that aboriginal expanded to Raisin Bran and Froot Loops.

Shares of WK Kellogg surged 30.9 percent successful mid-morning trading.

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Source: AFP