Dee-Ann Durbin and Michelle Chapman, AP Business Writer
Italian confectionery craftsman Ferrero, known for brands such as Nutella and Kinder, is purchasing a century-old US grain company, WK Kellogg, to expand sales in North America.
Ferrero Group said Thursday it would pay $23, or about $3.1 billion, per Kellogg stock. The transaction includes the marketing and distribution of six WK Kellogg Co. manufacturing plants and breakfast cereals in the US, Canada and the Caribbean.
WK Kellogg shares rose 31% early on Thursday afternoon.
Kellogg was founded in 1906 in Battle Creek, Michigan, after its founders accidentally found how to make flake cereal while experimenting with granola. Kellogg still makes corn flakes, float loops, special K, frost flakes, rice creampies and other cereals.
Kellogg currently has four US plants, located in Michigan, Pennsylvania, Tennessee and Nebraska. There are also plants in Mexico and plants in Canada. The company has approximately 3,000 employees.
The current company was founded in 2023. At that time, Kellogg snack brands like Cheez-Its and Pringles were spun into another company called Kellanova. M&M’s Maker Mars Inc. announced last year it plans to buy Kellanova for nearly $30 billion worth of deals.
Founded in Italy in 1946, the Ferrero Group is looking to expand its US footprint. In 2018, I bought Nestle’s US candy brands, including Butterfinger, Nerds and Sweetarts. In 2022, I bought Wells Enterprises, a manufacturer of ice cream brands such as Blue Bunny and Halo Top.
The WK Kellogg brand is struggling with a long-term decline in grain consumption in the US as consumers turn their attention to protein bars, shakes and other breakfast items. Sales of cereals collided during the coronavirus pandemic as more families stayed at home, but sales continued to decline even after the pandemic eased.
At the beginning of July, US cold cereal sales fell 6% compared to the same period in 2022, according to market research firm Nielsen IQ. Kellogg’s net sales fell 2% in 2024 to $2.7 billion.
Bradhaller, a senior partner at West Monroe’s merger and acquisition, said Kellogg’s large distribution network and its relationship with North American grocery chains appeals to Ferrero.
The purchase will also help Ferraro expand beyond snacks and sweets into the dietary category, Haller said. However, the company could also close Kellogg branded cutting or manufacturing plants.
“As Americans, these brands are iconic and loved by us, but the European companies that buy them don’t have the same nostalgia,” Haller said.
Kellogg had other issues. A nearly three-month strike by workers on all grain plants in the US in late 2021 hurt sales. And last fall, dozens of people gathered outside the company’s Battle Creek headquarters to demand that Kellogg remove artificial dyes from the grain.
Earlier this year, Kellogg said it would reformulate the grains sold to schools to remove artificial dyes and not be included in the new products that will begin in January.
The Ferrero acquisition, which still requires approval from Kellogg shareholders, is expected to close later this year. Once the transaction is completed, Kellogg’s shares will no longer be traded on the New York Stock Exchange and the company will become a subsidiary of Ferrero.
Original issue: July 10th, 2025 10:48am EDT
