Italian confectionery giant Ferrero, renowned for its popular brands such as Nutella and Kinder, is set to acquire the historic US cereal manufacturer WK Kellogg for approximately $3.1 billion (AUD 4.74 billion). The acquisition will see Ferrero pay USD 23 (AUD 35) per share for Kellogg, which handles the production, marketing, and distribution of cereals throughout the US, Canada, and the Caribbean.
Following the announcement, WK Kellogg’s shares surged by 30% in premarket trading. Established in Battle Creek, Michigan, in 1906, WK Kellogg produces iconic cereal brands including Fruit Loops, Special K, Frosted Flakes, and Rice Krispies. The modern incarnation of the company emerged in 2023 after Kellogg’s snack divisions—such as Cheez-Its and Pringles—were separated into a standalone entity named Kellanova. Notably, Mars Inc., the maker of M&Ms, has plans to acquire Kellanova in a deal approximating USD 30 billion (AUD 45.8 billion).
Ferrero, founded in Italy in 1946, aims to bolster its presence in the US market. In its pursuit of expansion, the company previously acquired Nestlé’s American confectionery brands in 2018, which included Butterfinger and Nerds, as well as the ice cream manufacturer Wells Enterprises in 2022, known for brands like Blue Bunny and Halo Top.
This transaction is pending approval from Kellogg’s shareholders and is expected to be finalised in the latter half of the year. Once completed, Kellogg’s shares will cease trading on the New York Stock Exchange, and the company will operate as a subsidiary under Ferrero.