Kellogg Company will separate its North American and plant-based food businesses from its snacking business, allowing each to ‘unlock their full standalone potential’, a company statement reads.
“Kellogg has been on a successful journey of transformation to enhance performance and increase long-term shareowner value. This has included re-shaping our portfolio, and today’s announcement is the next step in that transformation,” said Steve Cahillane, Kellogg Company’s chairman and CEO.
“These businesses all have significant standalone potential, and an enhanced focus will enable them to better direct their resources toward their distinct strategic priorities. In turn, each business is expected to create more value for all stakeholders, and each is well positioned to build a new era of innovation and growth.”
While the names of the companies are still to be confirmed, the three separate entities will be:
- Global Snacking Co., with about $11.4 billion in net sales, will comprise global snacking, international cereal and noodles, and North America frozen breakfast. Brands include Pringles, Cheez-It, Pop-Tarts, Kellogg’s Rice Krispies Treats, Nutri-Grain, Coco-Pops, Crunchy Nut and Eggo.
- North America Cereal Co., with about $2.4 billion in net sales, operating in the U.S., Canada, and Caribbean. Brands include Kellogg’s, Frosted Flakes, Froot Loops, Mini-Wheats, Special K, Raisin Bran, Rice Krispies, Corn Flakes, Kashi and Bear Naked.
- Plant Co., with about $340 million in net sales, will be a plant-based foods company, anchored by the MorningStar Farms brand, with a significant opportunity to capitalise on strong long-term category prospects by investing further in North America penetration and future international expansion. The business is currently focused on the U.S., Canada, and Caribbean.
According to Kellogg’s, the three separate companies will be able to focus on their own distinct strategic priorities with financial targets that best fit their own markets, and enjoy a more focused allocation of capital and resources.
The spin-offs are expected to be completed by the end of 2023.