One of America’s best-known brands has this morning announced its split into three separate companies. The Kellogg Company, the breakfast cereal juggernaut, has announced It will transform itself into three separate companies once the Kellogg Board of Directors approves the plan.
All three new companies will be publicly traded and Kellogg says the split companies will be “in a better position to unlock their full standalone potential.” Announcing the news, Kellogg’s CEO Steve Cahillane said, “These businesses all have significant standalone capabilities, and an increased focus will enable them to better direct their resources toward their specific strategic priorities. “Each business is expected to create greater value for all stakeholders, and each is well-positioned to create a new era of innovation and growth.”
The three companies have yet to be named, but Kellogg’s detailed what each company will focus on:
- “Global Snacking Company”: This is the temporary name given to the company that will make and distribute some of Kellogg’s most coveted snacks and international cereals. Snack brands include Pringles, Cheese-Its, Pop-Tarts, Kellogg’s Rice Krispie Treats, and Nutri-Grain. International cereals include Special K, Tracer/Krav, Crunchy Nuts and Cocoa-Pops. Kellogg’s says that based on 2021 figures, the company’s total sales will be about $ 11.4 billion.
- “North America Cereal Company”: This company will create and distribute some of the top brands that people think of when they think of “Kellogg’s.” It will focus on ready-to-eat cereals in the United States, Canada and the Caribbean. The cereal brands under the company’s banner will include Kellogg’s, Frosted Flakes, Special K, Fruit Loops, Mini-Wheats, Raisin Bran, Rice Krispies, Corn Flakes, Kashi and Bear Naked. Based on 2021 figures, its total sales will be around $ 2.4 billion.
- “Plant Company”: This last company can be considered as the newest when it comes to brands. That’s because it will make and distribute Kellogg’s plant-based foods. Its main brand will be the Morningstar Farms line of food and will focus on the United States, Canada and the Caribbean markets. Based on 2021 figures, its total sales will be around $340 million.
The “North America Grain Company” and “Plant Company” headquarters will remain in Battle Creek, Michigan, while the “Global Snacking Company” will be based in Chicago. Kellogg’s spinoffs into three different companies are expected to be completed by the end of 2023.
Investors seem to have welcomed the news so far. As of the time of this writing, Kellogg stock (ticker: K) is up more than 8% in pre-market trading at $73.11 per share.