Mars closes a deal to buy Kellanova, maker of Pringles, for $36.6 billion
The acquisition, for which the U.S. company will pay a total of $83.50 per share to one of its main snack competitors, will close during the first half of 2025.
A sales clerk with some cans of Pringles potato chips.
U.S. snack company Mars announced Wednesday that it has closed a deal to buy Kellanova, maker of well-known brands such as Pringles and Pop-Tarts, for $36.6 billion.
This implies that Mars, which said the purchase will close in the first half of 2025, would pay in cash a sum of $83.50 per share, which is 33% above the price the stock closed at on Aug. 2.
Financial Times reports that along with this the U.S. conglomerate, whose portfolio includes brands such as M&M's, Snickers and Skittles, will also assume more than $6 billion of debt held by Kellanova.
The price Mars is willing to pay is unusually high for the snack sector, especially considering that sales of such products have plummeted due to the health risk as well as their high price because of inflation.
However, the company's executives do not seem concerned but, they said, will be able to assume the cost through "a combination of cash-on-hand and new debt, for which commitments have been secured."
What's more, Mars CEO Poul Weihrauch assured, the Kellanova purchase will allow them to diversify and add savory snacks to their product portfolio as they previously specialized in sweet snacks:
"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."
This was the same view taken by Mars Global President Andrew Clarke, who, in a statement obtained by CNN, said the deal will allow them to reach a greater number of consumers.
"The Kellanova brands significantly expand our snacking platform, allowing us to even more effectively meet consumer needs and drive profitable business growth."
It doesn't look like a bad deal for Mars either. As AFP was able to learn, Kellanova, created when Kellogg's Company decided to separate its cereal and snack businesses, reported sales of $13 billion in 2023.
Present in 180 markets and with about 23,000 employees, the company will be a major asset of the family-owned Mars company that boasts annual sales in excess of $50 billion and a worldwide workforce of 150,000 employees.
In addition, the conglomerate is constantly expanding and acquired in recent years the maker of Kind bars as well as Nature's Bakery, Trü Frü and Hotel Chocolat.
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