Kellogg splits up its North American business

The result is three independent public companies each with distinct strategic priorities
Image from Kellogg Company’s website

Kellogg is separating its North American cereal and plant-based foods businesses, resulting in three independent public companies.

Kellogg stated that all three businesses have significant standalone potential, and an enhanced focus will enable them to direct their resources better toward their distinct strategic priorities.

Global Snacking Co will be Kellogg’s global snacking, international cereal and noodles, and North America frozen breakfast company

With 2021 net sales of $11.4 billion, Global Snacking Co represents 80% of Kellogg Company’s portfolio and Steve Cahillane will remain chairman and chief executive of Global Snacking Co.

Kellogg stated: “This business will be a higher-growth company than today’s Kellogg Company, featuring a more growth-oriented portfolio and aided by more focused resources and attention to brand building, innovation, and international expansion of world-class brands, and to building scale in emerging markets.”

Kellogg Company’s three international regions will remain almost entirely intact, becoming part of Global Snacking Co.

North America Cereal Co will become Kellogg’s cereal company in the US, Canada, and Caribbean.

Kellogg stated: “As a standalone company, North America Cereal Co will have greater strategic focus and operational flexibility, and will direct capital and resources toward unlocking growth, regaining category share, and restoring and expanding profit margins.”

The third arm of the organisation will be Plant Co, Kellogg’s plant-based foods company, anchored by the MorningStar Farms brand.

Kellogg stated: Kellogg’s leading plant-based business has enjoyed an impressive history in its category and has several avenues for continued growth and expansion. Kellogg intends to separate Plant Co. as an independent business through a spin-off, while also exploring other strategic alternatives, including a possible sale.

“The business has a proven winner with the MorningStar Farms brand, which Kellogg has grown since its acquisition 20 years ago to have the highest share and household penetration in the frozen vegetarian/ egan category.

“As an independent business, Plant Co will have the opportunity to build on its strong base of growth and profitability, focusing its resources and investments towards capitalizing on strong category prospects, by building awareness and penetration in North America, and expanding internationally in the future.”