Kellogg (K) announced Monday it reached a definitive agreement to sell a portion of its Kellogg’s North America snacking business to the Ferrero Group for $1.3 billion.
The brands included in the deal include Keebler, Mother’s, Famous Amos, Murray’s and Murray’s Sugar Free as well as the cookies manufactured for Girl Scouts of the U.S.A.
The deal is expected to close by the end of July.
“This divestiture is yet another action we have taken to reshape and focus our portfolio, which will lead to reduced complexity, more targeted investment, and better growth,” said Steve Cahillane, Kellogg chairman and CEO. “Divesting these great brands wasn’t an easy decision, but we are pleased that they are transitioning to an outstanding company with a portfolio in which they will receive the focus and resources to grow.”
Kellogg estimated that those businesses recorded net sales of nearly $900 million and an operating profit of approximately $75 million in 2018. Kellogg will retain the rest of its North American snacking businesses, including its crackers, salty snacks and other goods.
“On behalf of our entire company, I want to thank the many employees who support these businesses and have contributed to the strength of these brands,” Cahillane added. “We appreciate their passion, commitment and everything they have done for Kellogg. These talented individuals are going to a first-class organization in Ferrero, where they undoubtedly will thrive.”