It’s Official: Mars Agrees to $36B Deal to Acquire Kellanova

After days of swirling speculation, Mars, Inc. today announced it has entered into a definitive agreement to acquire Kellanova for $83.50 per share in cash, representing a total enterprise value of $35.9 billion.

The transaction includes all of Kellanova’s brands, assets and operations across snacking (Pringles, Cheez-It, Pop-Tarts, Rice Krispies Treats, NutriGrain and RXBAR), international cereal and noodles, North American plant-based foods (MorningStar Farms) and frozen breakfast (Eggo).

In 2023, Kellanova generated net sales of more than $13 billion. It has a presence in 180 markets and employs approximately 23,000 people.

Kellanova’s portfolio expands Mars’ suite of billion-dollar snacking and confectionery brands including Snickers, M&M’s, Twix, Dove, Extra, KIND and Nature’s Bakery. Privately-held Mars had 2023 sales of more than $50 billion and employs more than 150,000 people across its petcare, snacking and food businesses.

The purchase price represents an acquisition multiple of 16.4x LTM adjusted EBITDA as of June 29, 2024.

Mars intends to finance the acquisition through a combination of cash-on-hand and new debt. The transaction remains subject to Kellanova shareholder approval and other customary closing conditions, and is expected to close within the first half of 2025.

Following the close, Kellanova will become part of Mars Snacking division, led by global president Andrew Clarke and headquartered in Chicago. Battle Creek, Mich., will be a “core location” for the combined organization.

In a statement, Clarke credited the companies’ complementary portfolios, routes-to-market and research and development capabilities in unlocking growth and unleashing “consumer-centric innovation to shape the future of responsible snacking.”

Kellanova was spun off from Battle Creek-based Kellogg Company’s North American cereal business last October and accounted for approximately 82% of the company’s portfolio. Steve Cahillane, chairman, president and CEO of Kellanova, called the combination with Mars “historic” and 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. 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,” Cahillane said in a press release.

The addition of Kellanova marks a swerve from Mars’ recent acquisition history. Last year, the McLean, Va.-based company bought better-for-you meal maker Kevin’s Natural Foods for an undisclosed sum, months after it agreed to buy whole-fruit snack maker Trü Frü.

“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 of Mars, in a statement.