La American multinational Mars, known for its iconic candy brands such as M&M's, Snickers and Skittles, has announced the acquisition of food company Kellanova, owner of brands such as potato chips Pringles, Cheez-Its and Pop-Tarts. for a total of 35,9 billion dollars, including debt. The operation involves a payment of 83,50 dollars per share should be completed by the first half of 2025. Mars' acquisition of Kellanova marks the company's entry into the savory snacks market. If it goes through, it will be the largest merger in the food industry since Kraft and Heinz combined in 2015.
The details of the operation
Mars said it will pay $83,50 per share in cash, valuing the entire operation at $35,9 billion, or 16,5 times adjusted EBITDA. The price represents a premium of 44% compared to the average price of Kellanova shares on the stock exchange, making the offer particularly attractive for the company's shareholders. The transaction will be financed through a combination of liquidity and new debt, for which Mars has already secured funding commitments.
The agreement was unanimously approved by Kellanova's Board of Directors and will now be submitted to shareholders for approval. If everything goes according to plan, the operation will be completed by the first half of 2025.
Strategic acquisition
The acquisition of Kellanova represents a strategic move of great importance for Mars, which with this operation expands beyond the confectionery sector to strengthen itself in the savory snacks market. Kellanova is a relatively young company, having been spun off last year from Kellogg, an American giant known for its cereals. Kellanova has focused primarily on the snack market, with a portfolio of brands that includes, in addition to Pringles, Cheez-It, Pop-Tarts, Eggo and MorningStar Farms. Although the international grains operations remained under Kellanova, the North American operations were assigned to WK Kellogg, another entity spun off during the reorganization.
Il Kellanova's success in the snacks sector has made the company an attractive target for Mars, which already includes well-known names such as Snickers and M&M's, and which, with this acquisition, not only expands its presence in the sector, but also acquires a series of brands that have proven to have a strong impact on the market.
“With Kellanova's portfolio of brands, we have a substantial development opportunity,” he said Poul Weihrauch, CEO of Mars. “It's a historic combination, with excellent cultural and strategic compatibility,” he added Steve Cahillane, president and CEO of Kellanova.
The combination of these two companies will lead to a significant expansion of Mars' portfolio in the snacking sector, a growing market that offers significant opportunities for innovation and development. With revenues of $50 billion in 2023, Mars is already one of the global leaders in the food industry, and this acquisition will further strengthen its position.
Mars: a family-run giant
Mars is one of the largest and most recognizable multinational corporations in the world, with a annual turnover of 50 billion dollars. The peculiarity of Mars (as well as for Ferrero) is the fact that it is one private family-run company, despite its colossal size. Founded in 1911 by Franklin Clarence Mars, the company is now led by third generation of the Mars family, with John Franklin Mars occupying the position of president.
Despite its private nature, Mars has managed to grow and compete globally, becoming one of the most influential food companies in the world. The Mars family is among the richest in the world, with John Franklin Mars and his sister Jacqueline occupying top positions in Bloomberg's billionaire rankings.
