Candy giant Mars said on Wednesday it would buy Cheez-It and Pringles maker Kellanova in a nearly $36 billion deal.
Packages of Pringles potato chips are displayed on a shelf at a market on April 5, 2011 in San Francisco, California. Diamond Foods Inc. has agreed to purchase Pringles chip operations from Procter & Gamble Co. for $1.5 billion, a move that will triple the size of its snack foods business.Family-owned candy giant Mars, whose brands include M&M's and Snickers, said on Wednesday it would buy Cheez-It and Pringles makerMars will pay $83.
This has spurred dealmaking in the packaged food sector as companies seek scale to weather the impact of price inflation and weight-loss drugs weighing on demand. The deal dwarfs Mars' $23 billion takeover of Wrigley in 2008 and would bring under one roof a slate of popular consumer brands including Mars' Twix, Bounty and Milky Way chocolates as well as Kellanova's snacks portfolio of Pop-Tarts, Rice Krispies Treats and Eggo frozen waffles.
The acquisition is not expected to go through too many antitrust roadblocks due to the limited overlap between the two companies' offerings, legal experts had told Reuters. Kellanova, which split from WK Kellogg Co. last October, is rooted in a salty snacks business in the U.S. and around the world, and selling cereal outside of North America. WK Kellogg was left with the North American cereal business of Kellogg, the original parent company.This story is developing. Please check back for updates.
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