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CNN
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Shares of WK Kellogg, the cereal maker behind Froot Loops and Frosted Flakes, skyrocketed as high as 50% after the Wall Street Journal reported Wednesday that Ferrero was nearing acquiring the company for $3 billion.
The Wall Street Journal reported the deal, in which the Nutella and Ferrero Rocher maker would acquire WK Kellogg for $3 billion, could be finalized as early as this week.
Ferrero, which began as a family business in Italy in the 1940s, has been foraying across the pond into North America. In 2022, it acquired Wells Enterprises, the US-based ice cream company that owned Blue Bunny and and Blue Ribbon popsicles, and had also bought Nestle’s US chocolate business. The addition of WK Kellogg, which has a market cap of roughly $1.5 billion and a portfolio of household cereal names from Raisin Bran to Corn Flakes to Apple Jacks, could be its most substantial acquisition yet.
In its latest financial year, Ferrero reported a revenue of 18.4 billion euros. WK Kellogg and Ferrero Rocher did not immediately respond to requests for comment.
In 2022, Kellogg announced it was spinning off its cereal business, a major shakeup for the more-than-century-old company. Its snack unit was renamed Kellanova. The company said at the time that spinning off the companies will “better position each business to unlock its full potential,” especially as the company has grown with acquisitions in recent years
Last year, Mars bought Kellanova in a deal worth $35.9 billion.
The sale of WK Kellogg to Ferrero would be another upheaval in a volatile time for the snack industry, as consumer change preferences and pull back spending amid higher prices. WK Kellogg’s CEO Gary Pilnick came under fire last year for encouraging customers to eat cereal for dinner as shoppers grappled with skyrocketing food prices.
CNN’s Jordan Valinsky contributed to this report.
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