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Mars Inc., the global snack and candy giant, has agreed to acquire Kellanova, the maker of Pringles and Cheez-It, for $35.9 billion, including assumed debt. This landmark deal, announced Wednesday, marks a significant move in the snacking industry, allowing Mars to further shape the future of snacking.

Skadden Arps Slate Meagher & Flom LLP is acting as legal adviser to Mars, while Simpson Thacher & Bartlett LLP is providing debt financing counsel. On the other side, Kirkland & Ellis LLP is representing Kellanova in this high-profile transaction.

Mars Sees Opportunity in Snacking Market

Mars will purchase Kellanova's shares at $83.50 each in cash, representing a 44% premium to Kellanova's 30-day volume-weighted average price as of August 2. Following the announcement, Kellanova's stock surged by 7.5% at the market's opening on Wednesday, hitting $80.12 per share.

This transaction will bring together Mars' popular brands, including Snickers, M&M'S, and Twix, with Kellanova's beloved products like Pringles, Cheez-It, and Pop-Tarts. The merger is expected to close in the first half of 2025, pending shareholder and regulatory approvals.

"In welcoming Kellanova's portfolio of growing global brands, we have a substantial opportunity for Mars to further develop a sustainable snacking business that is fit for the future," said Mars CEO Poul Weihrauch. He emphasized that the company will honor the heritage and innovation behind Kellanova's iconic brands while enhancing consumer choices and innovation.

Mars to acquire Kellanova in $36B deal : Strategic Fit and Future Growth

The agreement, unanimously approved by Kellanova's board, signals a strong cultural and strategic alignment between the two companies. Mars' acquisition includes all of Kellanova's brands, assets, and operations, encompassing snacking brands, cereals, plant-based foods, and frozen breakfasts.

Steve Cahillane, Kellanova's chair, president, and CEO, expressed excitement about the deal, calling it a historic combination. "Kellanova has been on a transformation journey to become the world's best snacking company, and this opportunity to join Mars enables us to accelerate the realization of our full potential and our vision," Cahillane said.

Once the deal is finalized, Kellanova will integrate into Mars Snacking, led by Global President Andrew Clarke and headquartered in Chicago.

Mars to acquire Kellanova in $36B deal : Advisors and Legal Teams

Citi is serving as the financial adviser to Mars, with Goldman Sachs and Lazard advising Kellanova and its board, respectively. The legal teams involved include a robust lineup from top firms.

The Kirkland & Ellis team advising Kellanova is led by corporate partners Eric Schiele and Allie Wein, among other specialists across various legal areas. Meanwhile, Mars is being advised by a team from Skadden Arps, including M&A partners Howard Ellin, Neil Stronski, and June Dipchand.

The W.K. Kellogg Foundation Trust and the Gund Family, representing 20.7% of Kellanova's common stock, have agreed to vote in favor of the transaction, further cementing the deal's path to completion.

Industry Impact

Mars' acquisition of Kellanova for $36 billion marks one of the most significant moves in the snacking industry, potentially redefining the market landscape. As Mars expands its snacking portfolio, this deal underscores the growing demand for innovative and sustainable snack options, positioning Mars as a dominant force in the global market.