Kellogg Company has agreed to offload its cookies business and a range of fruit and fruit-flavoured snacks, pie crusts, and ice cream cone brands to Italy’s Ferrero Group for approximately $1.3 billion. Kellogg announced in November 2018 that is was exploring the sale of its cookies and fruit snacks businesses so it could focus on its core operations. The proposed sale comprises a significant portion of Kellogg’s North American snacks business, and includes the entirety of Kellogg’s North American cookies unit, which is composed of brands including Keebler, Mother’s, Famous Amos and cookies manufactured for the Girl Scouts of the USA. The transaction is subject to regulatory approval, and it is expected to be completed by the end of July 2019. Production facilities located in US cities including Augusta, Georgia; Florence, Kentucky; Louisville, Kentucky; Allyn, Washington; and Chicago, Illinois are also included as part of the deal.
FERRERO STRENGTHENING IN THE US
Steve Cahillane, Kellogg’s chairman and CEO, said: “Divesting these great brands wasn’t an easy decision, but we are pleased that they are transitioning to an outstanding company with a portfolio in which they will receive the focus and resources to grow. On behalf of our entire company, I want to thank the many employees who support these businesses and have contributed to the strength of these brands. We appreciate their passion, commitment and everything they have done for Kellogg. These talented individuals are going to a first-class organization in Ferrero, where they undoubtedly will thrive.” The transaction further strengthens Ferrero presence in the US market, following the company’s purchase of Nestlé’s US confectionery unit for $2.8 billion last year.