Kellogg Co., the maker of Frosted Flakes, Rice Krispies and Eggo, will split into three companies focused on cereals, snacks, and plant-based foods.
Kellogg’s, the company that owns MorningStar Farms, a plant-based food maker, announced on Tuesday 21st June that the spinoff of the yet-to-be-named cereal and plant-based food companies would be finished by the end of the coming year.
The company’s corporate headquarters will shift from Battle Creek, Michigan, to Chicago, while its snack division will maintain dual headquarters in both cities, accounting for around 80% of current sales. Kellogg’s three international headquarters in Europe, Latin America, and AMEA will remain in their current locations.
While companies like General Electric, IBM, and Johnson & Johnson have begun to split in a similar fashion at an accelerated pace, it is much rare for food producers. The last major split of this sort was back in 2012 when Kraft split to create Mondelez.
Kellogg shares soared 6.5% in premarket trading
“These businesses all have significant standalone potential, and an enhanced focus will enable them to better direct their resources toward their distinct strategic priorities,” Steve Cahillane, Kellogg Company’s chairman, and CEO said in the statement.
“In turn, each business is expected to create more value for all stakeholders, and each is well-positioned to build a new era of innovation and growth.”
Kellogg shares soared 6.5% in premarket trading on the announcement.