(New York) The American breakfast champion is about to split: Kellogg announced on Tuesday that it would split its operations into three separate companies, each with a public listing.
Posted at 8:23am
Updated at 9:18 am
The new structure will include a group to handle international sales of snack foods, cereal and instant noodles, and frozen breakfasts in North America, a company focused on cereal sales in the United States, Canada and the Caribbean, and finally an entity , focusing on the sale of products of plant origin.
The new companies will be “Global Snacking Co.”, “North America Ceral Co.” or “Plant Co.” are called, Kellogg said, noting that these are temporary names.
The internationally oriented company’s operations accounted for more than 80% of the group’s sales ($11.4 billion) last year, its North American division about 17% ($2.4 billion), while meat alternatives accounted for less than 3% of its sales spot Kellogg. or $340 million.
By the end of 2023, Kellogg is targeting to complete the spin-off of North America Ceral Co. and Plant Co. from the core group, subject to US regulatory approvals.
The group, known for its corn flakes, frosties, honey pops and Special K cereals, said the companies would retain their headquarters.
The cereal distribution company in North America and the plant products distribution company will be located in Battle Creek, Michigan. The global company will be headquartered in Chicago, Illinois with a campus in Battle Creek.
Kellogg’s stock, which is listed on the New York Stock Exchange, was up about 6% in electronic trading ahead of Wall Street’s opening.
Each of the new entities has “significant independent potential, and an enhanced focus will allow them to better align their resources with their specific strategic priorities,” Kellogg CEO Steve Cahillane said in a statement.
“The goal of each company will be to create value for all stakeholders and each is well positioned to create a new era of innovation and growth,” continued Mr. Cahillane.
The history of Kellogg, a cult brand for millions of households, dates back to 1894 when the American industrialist WK Kellogg founded the company “Corn Flakes” before opening what later became the “Battle Creek Toasted Corn Flake Company” in 1906, renamed ” Kellogg Company”.
The food giant, which is based in 180 countries, produces Pringles potato chips, Cheez-It cheese crackers, pop-tart filled pastries and Eggo frozen waffles in addition to its famous cereals.
It also owns plant-based brands, including MorningStar Farms, Gardenburger, and Kashi.
Revenue in 2021 was $14.2 billion and annual profit was $1.8 billion.
Other large US companies have announced their separation in recent months. This was the case last November for the conglomerate General Electric and the pharmaceutical company Johnson & Johnson.