Mars eyes Kellanova deal to create consumer goods and petcare giant

Privately-owned Mars is believed to be eyeing a deal for snacks rival and Pringles owner Kellanova, the former snacks division of Kellogg’s. Kellanova is currently valued at $22bn.

Kellanova also makes Pop-Tarts, Cheez-Its and Rice Krispies Treats. Mars has annual sales of more than $50bn and over 150,000 employees. More recently, has become a major force in petcare. In 2017 it paid $9.1bn for VCA’s a group of 800 petcare hospitals. Last year it bought the UK’s Hotel Chocolat for £534m.

Some traditional big consumer brands are suffering in the wake of the inflation that followed the end of pandemic lockdowns with their initially successful attempt to hold and even increase prices now coming back to haunt them. Kellanova, so far, seems to have weathered the storm with sales and profits rising.

A combined Mars and Kellanova would be a major challenge for quoted CPG companies like Unilever and Mondelez as it could invest in its brands without worrying about the share price. It would also spark a major realignment of some of the world’s biggest ad agencies.