Italian confectionery company Ferrero, known for brands such as Nutella and Kinder, announced that it will acquire the century-old American cereal company WK Kellogg in a deal worth approximately $3.1 billion.
The Ferrero Group said it would pay $23 for each Kellogg share. The deal includes the manufacturing, marketing and distribution of WK Kellogg Co.'s breakfast cereal portfolio in the United States, Canada and the Caribbean.
WK Kellogg shares rose 30% in premarket trading on Thursday after news of the acquisition, which was later confirmed.
Kellogg, founded in Battle Creek, Michigan, in 1906, makes Fruit Loops, Special K, Frosted Flakes and Rice Krispies.
The current company was created in 2023 when Kellogg's snack brands, such as Cheez-Its and Pringles, were spun off into a separate company called Kellanova. M&M's maker Mars Inc. announced last year that it planned to buy Kellanova in a deal valued at nearly $30 billion. USD.
Ferrero Group, founded in Italy in 1946, has been trying to expand its presence in the United States. In 2018, it bought Nestle's American candy brands, including Butterfinger, Nerds and SweeTarts. And in 2022, it bought Wells Enterprises, the maker of ice cream brands such as Blue Bunny and Halo Top.
The deal, which still needs approval from Kellogg shareholders, is expected to close in the second half of the year. Once the deal closes, Kellogg's shares will no longer be traded on the New York Stock Exchange and the company will become a subsidiary of Ferrero.