Healthy and General

Kellogg wants to accelerate international expansion after

4 min read

Kellogg Company has approved a plan to spin-off its North American cereal and plant-based foods businesses from its global operations. The result will be three business units: ‘Global Snacking Co’ with US$11.4bn in sales; ‘North American Cereal Co’ with $2.4bn in revenue; and ‘Plant Co’ with around $340m in sales.

“This is a big announcement,”​ Chairman and CEO Steve Cahillane said on a conference call today, describing the proposal as the ‘next step’ in the company’s portfolio transformation. On a stand-alone basis, he claimed each business is better positioned to unlock shareholder value and ‘build a new era of innovation and growth’.

Accelerating international expansion

Global Snacking Co will consist of ‘world class brands’ in ‘attractive categories’. The majority of its sales will be generated in snacking, with brands including Pringles, RXBar and CheezIts. It will also be home to Kellogg’s international cereal portfolio, the group’s African noodles business and the US Eggo unit.

Around 80% of net sales will be generated in higher growth snacking categories and emerging market geographies, Cahillane revealed, with 20% of sales coming from Europe and 30% of revenue originating from AMEA and Latin America.

It will be a company ‘geared towards growth geographically’, Cahillane – who will remain Chairman and CEO of Global Snacking Co – insisted. “Building on its track record of sales and profit growth and leveraging its portfolio and geographical diversification, this will be a higher growth company,”​ he said.