London, CNN - Mars, the confectionery giant behind iconic brands like Snickers and Mars bars, has reached an agreement to acquire Kellanova, the maker of popular snacks such as Cheez-Its and Pringles, in a deal valued at approximately £23 billion.
Kellanova, which emerged from the spin-off of Kellogg Company's snack and cereal businesses last year, announced in a regulatory filing that its shareholders would receive £67.30 per share in cash from Mars. The deal represents a significant premium to Kellanova's closing share price on Tuesday, sending its stock soaring by over 8% in pre-market trading.
The move comes amidst a turbulent economic landscape, with consumers increasingly seeking value for money and prioritizing healthier food choices. This trend has led to a wave of consolidation within the food industry, with companies like Nestle focusing on developing products that cater to weight management goals.
Despite inflationary pressures and a challenging economic environment, Kellanova has demonstrated resilience, exceeding analysts' expectations with strong first-half results. The company recently raised its sales forecast, citing robust demand for its snacks and other products, including Pop-Tarts, Eggo, and MorningStar Farms vegan and vegetarian options.
This acquisition marks one of the largest takeovers of the year, ranking among the top 10 global food and beverage mergers and acquisitions since 1995, according to Dealogic. It is the fourth-largest M&A deal so far in 2023.
The deal is expected to further strengthen Mars' position as a global food and beverage powerhouse. The family-owned company, boasting annual sales exceeding £40 billion and a workforce of 150,000, has been actively pursuing growth through acquisitions in recent years. In 2020, it acquired Kind and Nature's Bakery, followed by Trü Frü in 2022. Last year, Mars spent over £400 million to acquire Hotel Chocolat, a high-end British chocolatier.
This acquisition signifies Mars' commitment to expanding its snack food portfolio and solidifying its dominance in the global market. The deal is subject to regulatory approvals and is expected to close in the coming months.
