Editor’s Note
This article discusses Ferrero’s proposed acquisition of Kellogg’s. While the deal has been announced, it remains subject to shareholder approval. The reported share price represents a premium over Kellogg’s recent market closing value.
The Italian confectionery multinational Ferrero announced the acquisition of the American cereal giant Kellogg’s in a market deal valued at $3.1 billion. This agreement must receive final approval from the cereal company’s shareholders, but there is something important in the negotiation.
The price Ferrero will pay per share ($23) is higher than the value of Kellogg’s shares at market close. The shares closed at a lower price, and the maker of the iconic Nutella spread offered 31% more than that value.
Behind this acquisition lies a full strategy by Ferrero to diversify its portfolio by leveraging its already established position in the chocolate market.
Giovanni Ferrero, grandson of the founders, has undertaken a wave of acquisitions to further grow its presence in the United States.
The numbers support this. Last year, the Italian company recorded a 9% increase in sales, reaching €18.4 billion, and in 2022 it had acquired the ice cream maker Bomb Pops.
As a result of this strong growth, in the United States, Ferrero and its affiliated companies currently have more than 14,000 employees, distributed across 22 plants and 11 offices. Its portfolio in the region includes brands such as Nutella, Kinder, Tic Tac, Ferrero Rocher, Jelly Belly, NERDS, among others.
The acquisition covers the manufacturing, marketing, and distribution of the entire breakfast cereal portfolio of WK Kellogg in the United States, Canada, and the Caribbean. This operation aligns with Ferrero’s strategic growth plan, a company that has been expanding its presence in North America.
Furthermore, Kellogg’s had been going through a tough time economically, as its sales fell by $633 million in the first quarter of 2025, and the second quarter is projected to fall between $610 and $615 million. All this in a market that is moving away from sugary products and seeking cheaper or organic options.
To this is added the tariff war initiated by President Donald Trump against the world, which adds another obstacle for companies operating with profit margins that are not so high. Especially in a sector that has been significantly affected by inflation and the cost of raw materials.
This cereal brand has been iconic in the daily breakfasts of millions of citizens, so Ferrero’s purchase could imply launches or relaunches of products with new packaging. They could even reduce the sugar in their products or eliminate colorants and additives.
Another change that could occur is that the flavor of your favorite cereal changes permanently; or that prices rise using strategies to attract customers; or that the typical packaging box is no longer yellow or white, as they were accustomed to, and changes color.
