Kellogg Announces Plan To Split Into Three Companies

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Striking Kellogg workers picket outside a plant in Michigan
The entrance sign to Kellogg Co. is pictured at the Porter Street plant in Battle Creek, Michigan, U.S., December 11, 2021.

Cereal giant Kellogg has announced plans to begin splitting itself into three separate businesses in the next year. Upon completion, the brand will be undergoing its biggest transformation in its over 100 years of operation. 

In a statement, Kellogg's explained that it would be breaking apart into three independent public businesses: one focused on its global snack sales, a North America-focused business that will center on its cereal brands, and a third business that will focus on sales of plant-based foods that is centered on the MorningStar Farms brand. 

"Kellogg has been on a successful journey of transformation to enhance performance and increase long-term shareowner value,” said Kellogg Company CEO Steve Cahillane in a press release. "These businesses all have significant standalone potential, and an enhanced focus will enable them to better direct their resources toward their distinct strategic priorities."

By breaking into separate businesses, the company is hoping to achieve higher growth by establishing solid focuses on each of its product lines within the markets they perform best in. Currently, all of the brands under the Kellogg banner compete for resources against one another inside the company.

The names of the three spin-off companies have not yet been decided, but the three will maintain their presence in Kellogg’s traditional headquarters in Battle Creek, Michigan. The larger snacking business will also maintain a secondary presence in Chicago.

The Kellogg Company's snack-focused business earned about $11 billion in net sales last year while net sales for its cereal stands at $2.4 billion and its plant-based food arm netted about $340 million.

The decision has yet to receive final approval by Kellogg's board of directors or the necessary clearances from federal regulators before the dissolution is completed. By the company’s own estimates, the deal is expected to be completed by the end of 2023.

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