The latest news, trends, analysis, interviews and podcasts from the global food and beverage industry

Mars, the food giant known for brands like M&M's and Snickers, has acquired Kellanova, the maker of popular snacks such as Pringles and Cheez-It, for $35.9 billion.

This all-cash deal, which will see Mars pay $83.50 per share, represents a 33% premium over Kellanova's stock price prior to acquisition discussions.

The acquisition marks Mars' largest deal to date, surpassing its $23 billion purchase of Wrigley in 2008.

It will consolidate a diverse portfolio of consumer brands, combining Mars's chocolate products with Kellanova's snack offerings, which include Pop-Tarts, Rice Krispies Treats and Eggo frozen waffles.

In November 2023, Mars also acquired Hotel Chocolat for £534 million, signifying a pivotal development in the premium confectionery sector.

This strategic move comes at a time when US packaged food companies are grappling with shifting consumer preferences and economic pressures. As budget-conscious consumers increasingly turn to private-label alternatives, major players like Kraft Heinz and Mondelez have experienced a slowdown in sales growth.

Following its separation from WK Kellogg Co last year, Kellanova has focused on expanding its salty snacks business globally, while Mars continues to dominate the confectionery market.

Despite the challenges posed by rising inflation and changing consumer spending habits, Kellanova has shown resilience, recently reporting a net profit attributable to shareholders of $1.14 billion.

The company has raised its full-year sales forecasts after exceeding earnings expectations, indicating strong demand for its products. This financial stability makes Kellanova an attractive acquisition.

This acquisition could signal a new wave of consolidation in the packaged food sector.

#Mars #Kellnova #acqusition #packagedfood #snacks #confectionery