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Could MorningStar Farms become a Mars brand?
Mars and Kellanova seem to be a good fit, analysts say, because they both have popular snack brands. Get more details.
August 5, 2024
2 Min Read
At a Glance
- Mars Inc. could spend $30 billion to acquire Kellanova, the maker of popular Kellogg-branded snacks.
- A deal could be executed soon, unnamed sources told The Wall Street Journal on Sunday.
Mars Inc. is working on a deal to purchase Kellanova, the snacks and cereal company that spun off from Kellogg last year, Reuters News Agency and The Wall Street Journal both reported on Sunday.
The Wall Street Journal’s unnamed sources say a deal could be imminent if the negotiations continue.
Kellanova has a market value of about $22 billion, WSJ reports; the deal could cost $30 billion, it says. Reuters put Kellanova’s market value at $27 billion as of Friday. Kellanova and Kellogg’s split in October, with the cereal business taking the name WK Kellogg and the snacks division becoming Kellanova. Both brands have continued to use the traditional Kellogg’s logo, however.
"We believe that K's portfolio of popular snack brands will fit well with Mars' and help them expand scale in international markets," TD Cowen analyst Robert Moskow told Reuters on Monday.
Brian Holland, an analyst with D.A. Davidson, predicts that shares of Kellanova could reach $87 each if the takeover proceeds, Reuters reported Monday.
David Faber of CNBC reported on Monday that Hershey could also be interested in buying Kellanova.
In addition to its well-known snack and breakfast brands—Pringles, Cheez-It, Eggo waffles and Pop-Tarts—Kellanova owns plant-based food maker MorningStar Farms. Kellanova is based in Chicago, Illinois. None of the published reports that New Hope Network found discuss the future of MorningStar Farms.
MorningStar Farms announced in March 2019 that it would transition its product line to 100% vegan by 2021. This change was made to reduce water waste, land usage and carbon emissions associated with egg production, a Kellogg’s executive said at the time.
Mars Inc., which is privately owned, produces M&Ms, Snickers, Skittles and a large line of pet food brands including Cesar, Eukanuba, Pedigree, Royal Canin and Greenies. Mars is based in McLean, Virginia.
On Monday, Kellanova’s stock opened at $75.11 and closed at $72.98; it closed at $62.98 on Friday.
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