The US food group Kellogg will be split into three publicly traded companies as it spins off its US cereal business and its plant-based food arm, which together account for about a fifth of its sales.
The proposed spin-offs will distribute shares to Kellogg investors in the cereal company, which will generate about $2.4 billion in net sales, and the plant-based group. The shares will be distributed proportionally to the investors’ participation in the parent company.
The global food brand said on Tuesday that it expects the US cereal subsidiary to be spun off first, and that it intends to complete both transactions by the end of next year.
The plant-based group, which generates about $340 million in sales, will be anchored by the MorningStar Farms brand.
The remaining 80% of the Michigan-based food group’s trunk, which generated about $11.4 billion in net sales in 2021, focuses on international snack foods, cereal and pasta, as well as frozen breakfast products in North America. Nearly 60% of net sales are from global snack foods such as Pringles, Pop-Tarts and Cheez-It.
The global snacks business “is expected to be a faster growth company than the Kellogg Company of today,” the group said in a statement Tuesday.
North America will account for less than half of its net sales, with emerging markets accounting for around 30% and international developed markets for another 20%.
“All of these businesses have significant standalone potential,” said Steve Cahillane, chief executive and president of Kellogg.
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