Mars declares intentions to acquire Pringles maker Kellanova for USD36B


(MENAFN) Mars, the company behind popular brands such as M&M's and Snickers, announced on Wednesday its intention to acquire snack food business Kellanova in a significant multibillion-dollar deal. The all-cash transaction values Kellanova—known for its products like Pringles and Pop-Tarts—at USD35.9 billion, including debt. This acquisition aims to bolster Mars' position in the snacking industry and create a new powerhouse in the market.

Mars CEO Poul Weihrauch emphasized the strategic value of integrating Kellanova's portfolio, which presents a substantial opportunity to advance Mars' sustainable snacking business. He noted that the deal aligns with global consumer trends and the company's long-term goals. The announcement comes amid economic pressures on consumers, who are dealing with rising costs of living, which could influence how companies manage price adjustments.

The proposed acquisition may draw scrutiny from US regulators, particularly given the current climate of heightened antitrust enforcement. CFRA Research analyst Arun Sundaram highlighted that the scale of the transaction might attract regulatory attention, especially in the context of ongoing food price increases. Despite this, Sundaram anticipates that the deal will likely be approved due to the limited overlap between Mars and Kellanova's product categories.

Kellanova CEO Steve Cahillane expressed confidence in the regulatory review process, indicating that both companies have been in discussions with US regulators and anticipate no significant hurdles. He underscored the complementary nature of the companies' product lines, with Mars focusing on chocolate and Kellanova on snacks like Pringles. The acquisition, priced at USD83.50 per share in cash, is expected to accelerate Mars' ambitions to double its snacking division within the next decade, adding major brands such as Pringles and Cheez-It to its portfolio. Kellanova, with net sales of approximately USD13 billion in 2023 and operations in 180 markets, saw its shares rise by 7.7 percent in the US following the announcement.

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