US Food Company Kellogg to Split into Two Companies Next Month
American food company Kellogg, well known for its cereal product 'Corn Flakes,' will be split into two publicly traded companies.
According to Yahoo Finance and others on the 12th (local time), Kellogg held a board meeting the previous day and officially approved the separation of its North American cereal business and global snack business into separate entities. This measure will take effect from October 2.
![[Image source=Reuters Yonhap News]](http://www.asiae.co.kr/news/img_view.htm?img=2023091304343773238_1694547277.jpg)
Accordingly, Kellogg will operate as the cereal manufacturer 'WK Kellogg' and the snack manufacturer 'Kellanova.' The existing Kellogg will be renamed Kellanova and continue trading on the New York Stock Exchange under the ticker 'K.' WK Kellogg will begin trading under the ticker 'KLG' starting October 2.
Existing shareholders will be able to receive one share of WK Kellogg for every four shares of Kellogg they hold. The management expects this to lead to significant shareholder value creation. Steve Cahillane, CEO, said, "Through more than a year of comprehensive planning and execution, two stronger companies have been created." CEO Cahillane will lead Kellanova after the spin-off. WK Kellogg's CEO will be current Vice Chairman Gary Pilnick.
Previously, Kellogg announced in June last year plans to spin off into three entities: the North American cereal business, the meat alternative food business, and the snack business. However, the plan to spin off the meat alternative brand MorningStar Farms was later withdrawn.
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Kellanova will focus on snacks and emerging markets to build a growth-oriented portfolio. Net sales of approximately $13.4 billion to $13.6 billion are expected in 2024. Kellanova's portfolio includes its flagship products such as Pringles, Rice Krispies Treats, Cheez-It, and MorningStar Farms. Meanwhile, WK Kellogg plans to modernize its supply chain based on its leading market share in the North American cereal market to enhance competitiveness and profitability. Net sales of $2.7 billion are projected for 2024.
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