Ferrero confirms takeover agreement for WK Kellogg in $3.1bn deal

Ferrero has confirmed the confectionery giant has entered an agreement with WK Kellogg to acquire the US-based breakfast cereals business for $3.1bn.

The purchase price is a tad over the $3bn speculated earlier today (10 July) in media reports, quoting unnamed sources, that a deal was imminent.

Ferrero said in a statement the takeover of WK Kellogg, in a deal struck for $23 a share, is expected to close sometime in the current second half and is subject to regulatory approvals and clearance by shareholders of the North American cereals manufacturer.

The Italy-based Ferrero Rocher and Nutella maker added the transaction covers WK Kellogg’s “renowned beloved brands” in the US, Canada and the Caribbean such as Froot Loops, Special K, Rice Krispies and Raisin Bran.

Giovanni Ferrero, the executive chairman of privately owned Ferrero, said: “This is more than just an acquisition - it represents the coming together of two companies, each with a proud legacy and generations of loyal consumers.

“Over recent years, Ferrero has expanded its presence in North America, bringing together our well-known brands from around the world with local jewels rooted in the US.

The Kinder chocolate maker has in recent years struck deals for companies including US ice-cream maker Wells Enterprises and the UK’s Burton’s Biscuit Company.

Ferrero has also used M&A to build its position in the US. As well as the move for Wells, the early part of this year saw the Tic Tac brand owner acquire protein snacks maker Power Crunch in California. That built on the 2024 deal for the US-based biscotti biscuits business Nonni’s Bakery. Financial terms were not revealed for any of the transactions.

WK Kellogg was spun-off from the parent Kellogg in 2023 as the business split in two to create separate independent public companies and is headed up by Kellogg executive Gary Pilnick as chairman and CEO.

The other half of Kellogg – Kellanova, focused on the rest of the global cereals business outside North America, snacks such as Pringles crisps and frozen breakfast foods – is in the throes of a $36bn takeover by privately owned confectioner Mars, inked last August.

Pilnick said in today’s statement: “We believe this proposed transaction maximises value for our shareowners and enables WK Kellogg Co. to write the next chapter of our company’s storied legacy.

“Joining Ferrero will provide WK Kellogg Co. with greater resources and more flexibility to grow our iconic brands in this competitive and dynamic market.”

Post-transaction, WK Kellogg will continue to operate out of its Battle Creek, Michigan headquarters, which will become the base for Ferrero in North American breakfast cereal.