Mars to Buy Pringles Parent Company Kellanova in $29 Billion Deal

Mars has struck a major deal to buy Kellanova, the maker of popular snacks such as Cheez-It and Pringles, valuing the company at nearly $29 billion. In this agreement, Kellanova’s shareholders will receive $83.50 per share in cash, which is a 33% premium over the stock’s closing price on August 2, just before the deal was initially reported by Reuters. Including debt, the total deal value reaches $35.9 billion.

This acquisition will significantly boost Mars’ position in the global snack industry, as it adds a variety of well-loved brands to a portfolio that already includes Snickers, M&M’s, and the Mars bar. Andrew Clarke, the global president of Mars Snacking, highlighted the strategic importance of this move, stating, “The Kellanova brands significantly expand our snacking platform, allowing us to meet consumer needs more effectively and drive profitable business growth.”

Kellanova, which also produces Pop-Tarts, Eggo, and MorningStar Farms vegan and vegetarian foods, recently increased its sales forecast after a strong performance in the first half of the year. This deal, announced on Wednesday, is one of the largest takeovers of the year and comes amid a shift towards healthier consumer choices, pushing food giants like Nestle to innovate with products focused on weight management.

As economic pressures such as inflation and high interest rates lead to reduced consumer spending on non-essential items, sales at fast-food giants like McDonald’s, Burger King, and Starbucks have been affected. This acquisition positions Mars to capitalize on changing consumer preferences.

The Kellanova acquisition is among the top 10 global food and beverage mergers since 1995. It ranks as the fourth-largest M&A deal of this year, integrating two billion-dollar brands, Pringles and Cheez-It, into Mars’ array of 15 major brands.

Mars, a family-owned company with annual sales surpassing $50 billion and a global workforce of 150,000, has been aggressively expanding through acquisitions. In 2020, Mars acquired the company behind Kind bars and Nature’s Bakery. More recently, in 2022, it bought Trü Frü, known for its chocolate-covered fruit snacks, further broadening its snack offerings.