Chocolate giant Mars is to buy the owner of Pringles in a £28billion mega-deal that brings two of the world’s biggest food companies together.
The US conglomerate behind snacks such as Snickers and Skittles will pay £64.96 a share for Kellanova in an all-cash offer.
Kellanova was created when Kellogg’s was split into three last year. Its brands include Pringles, Carrs and Special K.
Sweet deal: Mars – known for sugary snacks such as M&M’s and Skittles – will pay £28bn for Pringles maker Kellanova
The proposed deal is the largest-ever acquisition in the packaged food industry and the biggest takeover of 2024 so far.
It comes as food firms struggle with declining volumes and slowing growth. Shoppers are moving away from branded goods and towards supermarkets’ own, cheaper items as inflation and interest rates hit spending.
Poul Weihrauch, chief executive of Mars, said: ‘We have a substantial opportunity for Mars to further develop a sustainable snacking business fit for the future.
‘We will honour the heritage and innovation behind Kellanova’s incredible snacking and food brands.’
Mars was founded in 1911 by Frank C Mars, who made and sold buttercream candy from his kitchen in Washington.
It has since grown into a global behemoth, with an empire spanning snacks to pet food.
It is the world’s largest pet food-maker and a major operator of vets globally, and is still owned by its founding family who are highly secretive about exact figures. Annual sales are around £38billion.
Mars’ last major deal was in 2017 when it bought veterinary hospital operator VCA for about £7billion.
This year, it snapped up UK chocolatier Hotel Chocolat for £534million.
It also bought chewing gum and snacks-maker Wm Wrigley Jr for £18billion in 2008.
Kellanova will diversify a chocolate-heavy portfolio, which includes Milky Way and Bounty.
‘Mars enhances its snacking business, possibly raising competitive levels for other large food players,’ Jefferies analyst Rob Dickerson said.
Steve Cahillane, chairman and chief executive of Kellanova, said it was a ‘truly historic combination with a compelling cultural and strategic fit’.
The deal will be subject to shareholder approval and probably face scrutiny from regulators because of its size. Mars hopes to complete it in the first half of 2025.
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