What the $36B Kellanova deal means for candy giant Mars

Aug 15

Karah Rucker Anchor

By Karah Rucker (Anchor), Brock Koller (Senior Producer), Zachary Hill (Editor)

A merger confirmed on Wednesday, Aug. 14, is looking to shake up the snack food aisle. Candy giant Mars, the company behind M&Ms and Snickers, is buying Kellanova, the maker of Cheez-Its and Pringles, for nearly $36 billion.

The purchase is not expected to close until 2025, but analysts have been discussing what’s in it for Mars. Bank of America’s Peter Galbo told CNBC the deal gives Mars three things: Additional space in stores beyond the chocolate section, expansion in international markets and opportunities for innovative new products.

“Then third, and probably the most fun for the consumer, you’re going to get the fun innovation with the salty and sweet what we’ve seen out of Hershey over the past year with things like chocolate covered popcorn.” Galbo said. “Now Mars will have that opportunity with some of the Kellanova brands.”

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The Associated Press suggested the deal could lead to possible combinations like Skittles-flavored Pop-Tarts or Snickers-flavored Pringles.

Yahoo! Finance said this deal accelerates Mars’ objective of doubling its snacking business. Fortune reported the merger will “allow Mars to expand its reach beyond just confections, solidifying its place in a crowded market, and keeping sales volumes high.”

“It’s a way for them to be a massive player within the whole entire snack category instead of just a segment of it,” Braden Douglas, founder and CEO of marketing agency Crew Marketing Partners, told Fortune.

Tags: candy, chocolate, food, merger

KARAH RUCKER

IT’S THE MERGER THAT’S SHAKING UP THE SNACK FOOD AISLE. LAST WEEK WE TOLD YOU ABOUT REPORTS THAT CANDY GIANT MARS WOULD ACQUIRE THE SNACK FOOD COMPANY KELLANOVA. ON WEDNESDAY – IT BECAME OFFICIAL.

MARS — THE COMPANY BEHIND M&MS AND SNICKERS – IS BUYING KELLANOVA – THE MAKER OF CHEEZ-ITS AND PRINGLES FOR NEARLY 36 BILLION DOLLARS.

WITH THE PURCHASE EXPECTED TO CLOSE NEXT YEAR — ANALYSTS HAVE BEEN DISCUSSING WHAT’S IN IT FOR MARS.

BANK OF AMERICA’S PETER GALBO TELLING CNBC AFTER THE DEAL WAS ANNOUNCED THAT IT GIVES MARS THREE THINGS – ADDITIONAL SPACE IN STORES BEYOND THE CHOCOLATE SECTION — EXPANSION IN THE INTERNATIONAL MARKETS – AND

PETER GALBO | BOFA SECURITIES DIRECTOR OF EQUITY RESEARCH

“And then third and probably the most fun for the consumer, you’re going to get the fun innovation with the salty and sweet what we’ve seen out of Hershey over the past year with things like chocolate covered popcorn – now Mars will have that opportunity with some of the Kellanova brands.”

KARAH RUCKER

THE ASSOCIATED PRESS SUGGESTING THE DEAL COULD LEAD TO POSSIBLE COMBINATIONS LIKE SKITTLES-FLAVORED POP-TARTS AND SNICKERS-FLAVORED PRINGLES.

WE HAVE ONE MORE IDEA – HOW ABOUT TWIX-FLAVORED EGGO WAFFLES? HEY, IT COULD HAPPEN, RIGHT?