Ferrero Acquires Kellogg’s Cookies and Fruit Snacks Business For $1.3 Billion
The Ferrero Group is acquiring the cookie, fruit and fruit-flavoured snack, ice cream cone and pie crust businesses from Kellogg Company for $1.3 billion (€1.16 billion). These US-based businesses generated sales of approximately $900 million and operating profit of approximately $75 million in 2018.
Ferrero will acquire a strong portfolio of beloved brands in the cookie category, including the iconic cookie brand Keebler®, top selling on-the-go Famous Amos® cookies, the premium family cookie brand Mother’s®, and Murray® sugar free cookies, as well as Little Brownie Bakers®, supplier of cookies to the Girl Scouts. Ferrero will also acquire the Kellogg fruit snacks business, including Stretch Island® and Fruity Snacks along with Keebler’s® ice cream cones and pie crust products.
Since 2017, Ferrero has acquired several US brands and businesses, and, with this transaction, Ferrero will enter into new strategic product categories and will further strengthen its position in the North American market.
Ferrero will also acquire from Kellogg six owned U.S. food manufacturing facilities located across the country in Allyn, Washington, Augusta, Georgia, Florence and Louisville Kentucky, and two plants in Chicago, Illinois; as well as a leased manufacturing facility in Baltimore, Maryland.
Giovanni Ferrero.
“Kellogg Company’s cookie, fruit snack, ice cream cone and pie crust businesses are an excellent strategic fit for Ferrero as we continue to increase our overall footprint and product offerings in the North American market,” explains Giovanni Ferrero, executive chairman of Ferrero Group. “With this transaction, I look forward to bringing many iconic Kellogg brands into the Ferrero portfolio, to welcoming our new colleagues to the extended Ferrero community, and to continuing Ferrero’s strong track record of growing brands, as we have through our successful acquisitions of Fannie May, Ferrara Candy Company, and the former Nestlé US confectionary business. We have great respect for Kellogg, its legacy and values, and are proud that Kellogg has chosen Ferrero as a good home for these businesses.”
Lapo Civiletti, cheif executive of Ferrero Group, says: “We are acquiring a portfolio of well-established brands that consumers love, with very strong market positions across their respective categories, allowing us to significantly diversify our portfolio and capitalize on exciting new growth opportunities in the world’s largest cookies market.”
The transaction, subject to customary closing conditions and regulatory approvals, is expected to close in the second half of the year.
“This divestiture is yet another action we have taken to reshape and focus our portfolio, which will lead to reduced complexity, more targeted investment, and better growth,” says Steve Cahillane, chairman and chief executive of Kellogg Company. “Divesting these great brands wasn’t an easy decision, but we are pleased that they are transitioning to an outstanding company with a portfolio in which they will receive the focus and resources to grow.”
Kellogg will retain the rest of its North America snacking businesses, including its crackers, salty snacks, wholesome snacks, and toaster pastries brands.
