MARS TO ACQUIRE KELLANOVA

The $35.9 billion deal enhances the manufacturer’s strategic vision for the future of snacking.

MCLEAN, Va., and CHICAGO — Mars Inc. and Kellanova have entered into a definitive agreement under which Mars will acquire Kellanova for $83.50 per share in cash, for a total consideration of $35.9 billion.

The transaction, which marks one of the largest deals of 2024, will unite two iconic businesses with complementary footprints and portfolios of beloved brands, the companies stated.

Kellanova is home to iconic snacking brands, including Pringles, Cheez-It, Pop-Tarts, Rice Krispies Treats, NutriGrain and RXBAR, as well as cherished food brands such as Kellogg’s (international), Eggo and MorningStar Farms.

With roots dating back more than 100 years, Kellanova has a rich legacy of quality and innovation. Kellanova had 2023 net sales of more than $13 billion, with a presence in 180 markets and approximately 23,000 employees.

“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,” commented Steve Cahillane, chairman, president and CEO at Kellanova.

“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,” he continued.

“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.”

The addition of Kellanova provides Mars Snacking — which includes billion-dollar snacking and confectionery brands including Snickers, M&M’S, Twix, Dove and Extra, as well as KIND and Nature’s Bakery — with entry into new attractive snacking categories.

It will add two new billion-dollar brands, Pringles and Cheez-It, to the Mars business, which today includes 15 billion-dollar brands.

The deal will also expand the health and wellness umbrella for the Mars Snacking portfolio with the addition of new complementary products, RXBAR and NutriGrain, to reflect global trends and preferences.

With more than 150,000 associates across its Petcare, Snacking and Food businesses, Mars had 2023 net sales of more than $50 billion.

“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,” said Poul Weihrauch, CEO and office of the president at Mars.

“We have tremendous respect for the storied legacy that Kellanova has built and look forward to welcoming the Kellanova team.”

Strategic Vision for the Future of Snacking

According to Mars, the acquisition of Kellanova positions the company to advance its strategic vision for the future of snacking by:

• Accelerating ambition to double Mars Snacking in the next decade, in alignment with global consumer demand trends;
• Enhancing the portfolio with the addition of unique, category-leading and growing brands;
• Delivering a stronger, differentiated portfolio and distribution platform for priority international markets;
• Bringing together world-class talent with unrivaled brand-building experience;
• Combining complementary capabilities to unlock growth and consumer-centric innovation; and
• Enhancing positive societal impact of strong sustainability efforts.

Upon completion of the transaction, which is expected to close the first half of 2025, Kellanova will become part of Mars Snacking, led by Snacking Global President Andrew Clarke.

“This is an exciting opportunity to create a broader, global snacking business, allowing Kellanova and Mars Snacking to both achieve their full potential,” Clarke said.

“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.”

Transaction Details

Under the terms of the agreement, Mars will acquire all outstanding equity of Kellanova for $83.50 per share in cash, representing a total enterprise value of $35.9 billion.

All of Kellanova’s brands, assets and operations, including its snacking brands, portfolio of international cereal and noodles, North American plant-based foods and frozen breakfast are included in the transaction.

Mars intends to fully finance the acquisition through a combination of cash-on-hand and new debt, for which commitments have been secured.

The agreement has been unanimously approved by the board of directors of Kellanova.

The transaction is subject to Kellanova shareholder approval and other customary closing conditions, including regulatory approvals.

The W.K. Kellogg Foundation Trust and the Gund Family have entered into agreements pursuant to which they have committed to vote shares representing 20.7% of Kellanova’s common stock, as of Aug. 9, in favor of the transaction.

After closing, Battle Creek, Mich., will remain a core location for the combined organization.

Citi is serving as financial advisor to Mars. J.P. Morgan and Citi have provided Mars with financing support for the transaction.

Skadden, Arps, Slate, Meagher & Flom LLP is serving as legal advisor to Mars on the acquisition, with Simpson Thacher & Bartlett LLP providing legal advice for the debt financing. Cravath, Swaine & Moore LLP is serving as financing counsel to J.P. Morgan and Citi.

Goldman Sachs is serving as financial advisor to Kellanova. Lazard is serving as financial advisor to Kellanova’s Board of Directors. Kirkland & Ellis LLP is serving as legal advisor to Kellanova.

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