WK Kellogg (NYSE:KLG) shares skyrocketed by over 57% in premarket trading after the Wall Street Journal reported that Ferrero, the Italian confectionery giant, is nearing a $3 billion deal to acquire the U.S. cereal company.
According to sources cited by the WSJ, the maker of Nutella and Ferrero Rocher could finalize the acquisition as early as this week, barring any last-minute complications in negotiations.
The potential deal would combine Ferrero’s growing U.S. portfolio with WK Kellogg’s iconic cereal brands, including Froot Loops and Rice Krispies, both household names across American breakfast tables.
Ferrero has aggressively pursued expansion in the United States, previously acquiring Wells Enterprises, the maker of Blue Bunny ice cream, and Nestlé’s U.S. chocolate business. The move reflects its broader strategy to diversify and strengthen its global footprint.
WK Kellogg, which spun off from Kellogg Company about two years ago, has faced recent challenges, including shifting consumer trends toward healthier food options and criticism over the use of artificial coloring in its cereals. Its former parent company later sold the remaining Kellanova (NYSE:K) snacking business to Mars for over $30 billion in 2024.
The packaged food sector has seen a wave of consolidation, including J.M. Smucker’s acquisition of Hostess Brands (NASDAQ:TWNK) and PepsiCo’s purchase of tortilla chip maker Siete Foods.
WK Kellogg ended trading Wednesday at $17.50, valuing the company at approximately $1.51 billion, significantly below the rumored buyout price—fueling speculation of a lucrative premium in the works.
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This content is for informational purposes only and does not constitute financial, investment, or other professional advice. It should not be considered a recommendation to buy or sell any securities or financial instruments. All investments involve risk, including the potential loss of principal. Past performance is not indicative of future results. You should conduct your own research and consult with a qualified financial advisor before making any investment decisions.