Italian confectioner Ferrero, known for brands like Nutella and Kinder, is buying the century-old U.S. cereal company WK Kellogg in an effort to expand its North American sales.
The Ferrero Group said Thursday it will pay $23 for each Kellogg share, or approximately $3.1 billion. The transaction includes WK Kellogg Co.’s six manufacturing plants and the marketing and distribution of its breakfast cereals across the United States, Canada and the Caribbean.
WK Kellogg’s shares were up 31% in mid-afternoon trading on Thursday.
Kellogg was founded in Battle Creek, Michigan, in 1906 after its founder accidentally figured out how to make flaked cereal while he was experimenting with granola. Kellogg still makes Corn Flakes, as well as Froot Loops, Special K, Frosted Flakes, Rice Krispies and other cereals.
Kellogg now has four U.S. plants, which are located in Michigan, Pennsylvania, Tennessee and Nebraska. It also has a plant in Mexico and a plant in Canada. The company has around 3,000 employees.