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

Chocolate giant Mars is to buy the owner of Pringles in a mega deal worth £28bn, bringing together two of the world’s largest food companies.

The US conglomerate behind snacks such as Snickers and Skittles is paying £64.96 per share for Kellanova in an all-cash bid.

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 to date.

It comes as food companies struggle with falling volumes and slowing growth. Consumers are moving away from branded goods and towards supermarkets’ own, cheaper items as inflation and interest rates hit spending.

Poul Weihrauch, CEO of Mars, said: ‘We see a substantial opportunity for Mars to develop a sustainable snacks business that is fit for the future.

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

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

Since then, the company has grown into a global giant with an empire ranging from snacks to pet food.

It is the world’s largest producer of pet food and a major operator of veterinary practices worldwide, and is still owned by its founding family, who are highly secretive about exact figures. Its annual turnover is around £38 billion.

Mars’ last major deal came in 2017, when the company bought animal hospital VCA for around £7 billion.

This year the company bought British chocolatier Hotel Chocolat for £534 million.

In 2008, the company also bought chewing gum and snack maker Wm Wrigley Jr for £18 billion.

Kellanova will diversify its chocolate-heavy portfolio, which also includes Milky Way and Bounty.

“Mars is bolstering its snacking business and potentially competing with other major players in the food industry,” said Rob Dickerson, an analyst at Jefferies.

Steve Cahillane, chairman and chief executive officer of Kellanova, called it a “truly historic combination with a compelling cultural and strategic fit.”

The deal will be subject to shareholder approval and likely regulatory scrutiny due to its size. Mars hopes to close in the first half of 2025.