Chocolate giant Mars swallows Pringles owner Kellanova in £28bn raid

Chocolate giant Mars is to buy the owner of Pringles in a mega £28bn deal that unites two of the world’s biggest food companies.

The US conglomerate behind snacks such as Snickers and Skittles will pay 64.96 pounds per share for Kellanova in an all-cash offer.

Kellanova was created when Kellogg’s split into three last year. Its brands include Pringles, Carrs and Special K.

The proposed deal is the largest acquisition ever in the packaged food industry and the largest acquisition of 2024 so far.

This comes as food companies struggle with declining volumes and slowing growth. Consumers are ditching branded products in favour of cheaper supermarket goods as inflation and interest rates hit spending.

Poul Weihrauch, Mars CEO, said: ‘We have a substantial opportunity for Mars to continue to develop a sustainable snacks business fit for the future.

‘We will honor the heritage and innovation behind Kellanova’s incredible food and snack brands.’

Mars was founded in 1911 by Frank C Mars, who made and sold buttercream confections from his kitchen in Washington.

Since then, it has grown into a global giant, with an empire spanning everything from snacks to pet food.

It is the world’s largest pet food manufacturer and a major global veterinary operator, and is still owned by its founding family, who are very secretive about the exact figures. Annual sales are around £38bn.

Mars’ last big deal was in 2017, when it bought veterinary hospital operator VCA for around £7bn.

This year, it acquired British chocolatier Hotel Chocolat for £534m.

It also bought chewing gum and snacks maker Wm Wrigley Jr for £18bn in 2008.

Kellanova will diversify a portfolio based primarily on chocolate, which includes Milky Way and Bounty.

“Mars is improving its snacks business, potentially raising its competitive edge against other major food players,” said Jefferies analyst Rob Dickerson.

Kellanova President and CEO Steve Cahillane said it was a “truly historic combination with a compelling cultural and strategic fit.”

The deal will be subject to shareholder approval and will likely face regulatory scrutiny due to its size. Mars expects to complete it in the first half of 2025.