A major new acquisition in the US seems to be getting closer and closer for the Italian confectionery giant Ferrero. According to rumors, the group, supported by advisors Lazard and Credit Suisse, is in fact in contention for the purchase of Kellogg’s lines of biscuits and snacks. The American multinational owes its fame mainly to corn flakes – its most famous brand in the world for 113 years. However, many other brands belong to the group, including Pringles chips. Ferrero seems to be ahead of other industrial players and private equity funds interested in Kellogg, starting with the US Hostess Brands which is the main competitor.
KELLOGG’S BRANDS
Kellogg’s cookie and confectionery brands include Keebler, Famous Amos, and Stretch Island. “We need to make strategic choices about our business, and these brands have had difficulty competing for resources and investments within our portfolio,” Steven A. Cahillane, chairman and CEO of Kellogg’s, said last January during a conference call. “Yet, we believe these iconic and beloved brands can thrive in the portfolio of another organization that can focus on driving growth in these categories”.
THE ACQUISITIONS STRATEGY OF FERRERO
Ferrero Group, the third largest chocolate confectionery company with global sales of more than $12 billion, entered the United States in 1969 with Tic Tac and subsequently Rocher and Nutella brands. The company recently acquired Nestlè USA’s confectionery business after earlier buying Fannie May Confections and Ferrara Candy Co. The Italian company based in Piedmont has also been identified as a potential buyer of Campbell Soup Co.’s Australia-based Arnott’s cookie business. Camden, N.J.-based Campbell Soup announced plans to divest its Campbell International business unit in late August 2018.
