Kellogg board approves separation into two companies

Kellogg Company’s Board of Directors has approved the separation of Kellogg Company into Kellanova and WK Kellogg Co.

The split is set to be completed on 2 October 2023, with Kellogg Company to be renamed Kellanova and featuring a portfolio that is weighted towards snacking and emerging markets, while WK Kellogg Co will build on the foundation of its cereal brands and focus and integrate its commercial strategy and execution.

Steve Cahillane, Chairman and CEO of Kellogg Company, will remain Chairman and CEO of Kellanova.

“After more than a year of comprehensive planning and execution, we are more confident than ever that the separation will produce two stronger companies and create substantial value for shareowners.”

On the New York Stock Exchange (NYSE), Kellanova will continue to trade under the ticker symbol ‘K’, while WK Kellogg Co is expected to begin trading on the NYSE under the ticker symbol ‘KLG’. The company has set the distribution ratio of shares at 1 share of WK Kellogg Co for every 4 shares of current Kellogg Company.

“We are looking forward to a new era as Kellanova, marked by a more growth-oriented portfolio, a renewed vision and strategy, and an energized organization grounded by a winning culture and our founder’s values,” said Cahillane.

Kellanova is projected to generate net sales of approximately US$13.4-$13.6 billion and adjusted-basis EBITDA of approximately US$2.25-$2.3 billion in 2024, with an expectation of long-term growth delivery of 3-5 per cent for net sales (organic basis), 5-7 per cent for operating profit (currency neutral and adjusted basis), and 7-9 per cent for earnings per share.

Gary Pilnick, who will serve as WK Kellogg Co’s Chairman and CEO following the separation, said WK Kellogg Co has a 117-year legacy of innovation and the soul of a start-up, with an organisation incredibly energized by its future.

“As a standalone company, we will benefit immediately from the executional advantages of increased focus and end-to-end integration while we modernize our supply chain and substantially improve our profit margins.  We’re on a profitable journey to take this great business to the next level.”

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