Mars, the iconic candy giant, is poised to take the lead in the snacking industry with its $36 billion acquisition of Pringles maker Kellanova. This transformative deal positions Mars to compete more aggressively against industry giants like Mondelēz International and PepsiCo, significantly expanding its presence in the snacking market.
The acquisition, expected to close in the first half of 2025, will create a snacking powerhouse with a vast portfolio of products ranging from chips and crackers to health-focused snacks. The new company will boast over $63 billion in net sales, with 17 brands generating over a billion dollars each in revenue, including Snickers, M&M’s, Twix, Cheez-It, and Pringles.
“This acquisition marks a significant step forward for Mars in building a sustainable snacking business that’s future-ready,” said Mars CEO Poul Weihrauch.
The deal is expected to bolster Mars’ snacking revenue to approximately $27 billion annually, edging the company closer to its goal of doubling its exposure in this sector to $36 billion within the next decade. Mars’ global market share in snacking, encompassing both sweet and salty products, is projected to increase to 6% post-acquisition, making it the third-largest player in the industry.
Experts suggest that this move may indicate challenges in Mars’ core confectionery business as the company diversifies its portfolio to tap into the growing demand for savoury snacks. “This acquisition signals Mars’ strategic shift towards the higher-growth snacking market,” said Dan McCarthy, associate professor of marketing at the University of Maryland.
The merger is also expected to fuel innovation, with opportunities for new product launches that blend the sweet and salty categories, similar to Hershey’s recent endeavors. Kellanova’s portfolio, which includes healthier options like Pringle’s Harvest Blends and whole-grain Cheez-Its, will complement Mars’ indulgent offerings, positioning the company to cater to evolving consumer preferences.
The acquisition will also allow Mars to leverage its existing infrastructure to extend the reach of Kellanova’s brands into new markets, replicating the successful strategy used with its 2020 acquisition of Kind.
“This is a good marriage between two high-calibre food companies,” said Arun Sundaram, equity analyst at CFRA Research. “Mars is known for its innovation and brand building, while Kellanova has the global reach to bring more Mars products to more markets.”
Mars, a privately held company with over $50 billion in revenue in 2023, has a strong track record of successful acquisitions, including Wrigley and Kind. The company’s experience in integrating and capitalizing on these deals positions it well to make the most of the Kellanova acquisition.
“Out of all the potential buyers, Mars is among the best,” McCarthy noted. “They’ve done a number of acquisitions in the past, and in general, they’ve been executed very well.”
As Mars prepares to finalize this landmark deal, the company is poised to solidify its status as a formidable force in the global snacking industry.