Mars Incorporated, a family-owned global leader in pet care, snacking and food, has entered into a definitive agreement to acquire global snacking, breakfast cereal and noodles company- Kellanova for $83.50 per share in cash, for a total consideration of $35.9 billion, with an ambition to double Mars Snacking in the next decade.
The transaction price represents a premium of approximately 44% to Kellanova’s unaffected 30-trading day volume weighted average price and a premium of approximately 33% to Kellanova’s unaffected 52-week high as of August 2, 2024.
The total consideration represents an acquisition multiple of 16.4x LTM adjusted EBITDA as of June 29, 2024.
With roots dating back more than 100 years, Kellanova in today’s time is home to some of the iconic snacking brands such as Pringles, Cheez-It, Pop-Tarts, Rice Krispies Treats, NutriGrain and RXBAR, as well as food brands like Kellogg’s, Eggo and MorningStar Farms.
In 2023, Kellanova had clocked in a Net Sales of more than $13 billion, with a presence in 180 markets and approximately 23,000 employees.
Kellanova’s portfolio complements the existing Mars portfolio comprising billion-dollar snacking and confectionery brands like SNICKERS, M&M’S, TWIX, DOVE and EXTRA, KIND and Nature’s Bakery, and pet care brands like ROYAL CANIN, VCA, PEDIGREE, BANFIELD, WHISKAS, BLUEPEARL, CESAR, SHEBA, ANICURA and IAMS.
That being said, with more than 150,000 associates across its Petcare, Snacking and Food businesses, Mars had clocked in a Net Sales of more than $50 billion in 2023.
Upon completion of the transaction, Kellanova will become part of Mars Snacking, led by Global President Andrew Clarke and headquartered in Chicago, allowing Mars to bring even more beloved brands to more consumers globally and apply its proven brand-building approach to further nurture and grow Kellanova’s brands, including accelerating innovation to meet evolving consumer tastes and preferences, investing locally to expand reach and introducing more better-for-you nutrition options to meet evolving consumer needs.
Commenting on the development, Poul Weihrauch, CEO and Office of the President of Mars, said, “In welcoming Kellanova’s portfolio of growing global brands, we have a substantial opportunity for Mars to further develop a sustainable snacking business that is fit for the future. We will honor the heritage and innovation behind Kellanova’s incredible snacking and food brands while combining our respective strengths to deliver more choice and innovation to consumers and customers. We have tremendous respect for the storied legacy that Kellanova has built and look forward to welcoming the Kellanova team.”
To this, Steve Cahillane, Chairman, President and CEO, Kellanova, added, “This is a truly historic combination with a compelling cultural and strategic fit. Kellanova has been on a transformation journey to become the world’s best snacking company, and this opportunity to join Mars enables us to accelerate the realization of our full potential and our vision. The transaction maximizes shareholder value through an all-cash transaction at an attractive purchase price and creates new and exciting opportunities for our employees, customers, and suppliers. We are excited for Kellanova’s next chapter as part of Mars, which will bring together both companies’ world-class talent and capabilities and our shared commitment to helping our communities thrive. With a proven track record of successfully and sustainably nurturing and growing acquired businesses, we are confident Mars is a natural home for the Kellanova brands and employees.”
Furthermore, Andrew Clarke, Global President of Mars Snacking, also commented, “This is an exciting opportunity to create a broader, global snacking business, allowing Kellanova and Mars Snacking to both achieve their full potential. Kellanova and Mars share long histories of building globally recognized and beloved brands. The Kellanova brands significantly expand our Snacking platform, allowing us to even more effectively meet consumer needs and drive profitable business growth. Our complementary portfolios, routes-to-market and R&D capabilities will unleash enhanced consumer-centric innovation to shape the future of responsible snacking.”
