Kellogg Co. (NYSE: K) has reached a deal to sell its Keebler cookies brand and numerous other assets to Nutella maker Ferrero for $1.3 billion. According to reports, the deal is expected to close by the end of July. Ferrero retained J.P. Morgan Securities as financial advisor for the deal, while Davis Polk & Wardwell provided legal counsel. Kellogg tapped Evercore as lead financial advisor, while Goldman Sachs acted as co-advisor. Wachtell, Lipton, Rosen & Katz provided legal counsel to Kellogg.
According to the terms of the deal, Kellogg’s Keebler cookies, Famous Amos, Mother’s, Murray’s, and Girl Scout cookies brands. Kellogg’s fruit-flavored snacks, pie crusts, and ice-cream cones businesses are also part of the deal. Ferrero will also be taking control of six U.S. food manufacturing facilities and a leased manufacturing plant in Baltimore. The businesses being sold had net sales of nearly $900 million in 2018.
Ferrero was founded in the northern Italian town of Alba in 1946 by Michele Ferrero. Its famous Nutella chocolate and hazelnut spread was launched in 1964. Ferrero entered the U.S. market in 1969 with its Tic Tac mints. The company is also well known for its Ferrero Rocher pralines.
The brands that Kellogg has sold to Ferrero have been on the chopping block since last November. Now the company will be turning its focus to its core cereals and snacks businesses. It has retained the Keebler’s cracker business and expanded into trendy new brands, like the acquisition of RXBar, a protein bar brand that also makes nut butters and kids treats.
Kellogg currently has a market capitalization of $19.72 billion, Its shares are down nearly 11 percent over the past year.