A pack of Pringles potato chips is displayed on a market shelf in San Francisco, California on April 5, 2011. Diamond Foods Inc. has agreed to buy Procter & Gamble Co.’s Pringles potato chip business for $1.5 billion, a move that will triple the size of its snack food business.
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Mars, the family-owned candy giant whose brands include M&M’s and Snickers, said Wednesday it would acquire the maker of Cheez-It and Pringles chips Kelanova The deal is worth nearly $36 billion, making it the largest in the packaged food industry.
Mars will pay $83.50 per share in all cash for Kellanova, a premium of about 33% to Kellanova’s closing price on August 2, before Reuters first reported that Mars was exploring acquiring the Pringles potato chip maker.
Kellanova shares rose about 8% to $80.45 in pre-market trading. It’s valued at $28.58 billion in equity terms, according to Reuters calculations.
The deal comes as sales are growing for U.S. packaged food companies, including Kraft Heinz, Mondelez and hersheyslowing as budget-strapped customers opt for cheaper private label goods over more expensive branded goods.
The deal dwarfs Mars’ $23 billion acquisition of Wrigley in 2008 and will include Mars’ Twix, Bounty and Milky Way chocolates as well as Kellanova’s Pop-Tarts, Rice Krispies Treats and Eggo frozen waffles. The snack product portfolio is centralized under one roof.
Legal experts told Reuters the acquisition was not expected to face many antitrust hurdles due to limited overlap between the companies’ products.
Once the deal closes in the first half of 2025, Kellanova will become part of Mars Snacking, led by global president Andrew Clarke and headquartered in Chicago, the companies said.
Kellanova, which was spun off from WK Kellogg last October, focuses on salty snacks and sells cereals outside of North America. WK Kellogg retains the North American cereal business of its original parent company, Kellogg.
Kellanova’s 2023 net sales exceed $13 billion.
The Wall Street Journal reported the terms of the deal earlier Tuesday.
