Shares of Froot Loops cereal maker soar 50% after reports of Ferrero acquisition

Shares of WK Kellogg, the cereal maker behind Froot Loops and Frosted Flakes, skyrocketed as high as 50% after the Wall Street JournalreportedWednesday that Ferrero was nearing acquiring the company for $3 billion. The Wall Street Journal reported the deal, in which the Nutella and Ferrero Rocher maker would acquire WK Kellogg for $3 billion, could be finalized as early as this week. Ferrero, which began as a family business in Italy in the 1940s, has been foraying across the pond into North America. In 2022, itacquired Wells Enterprises,the US-based ice cream company that owned Blue Bunny and and Blue Ribbon popsicles, and had also bought Nestle’s US chocolate business. The addition of WK Kellogg, which has a market cap of roughly $1.5 billion and a portfolio of household cereal names from Raisin Bran to Corn Flakes to Apple Jacks, could be its most substantial acquisition yet. In its latest financial year, Ferrero reported arevenueof 18.4 billion euros. WK Kellogg and Ferrero Rocher did not immediately respond to requests for comment. In 2022, Kellogg announced it was spinning off its cereal business, a major shakeup for the more-than-century-old company. Its snack unit wasrenamedKellanova. The companysaidat the time that spinning off the companies will “better position each business to unlock its full potential,” especially as the company has grown with acquisitions in recent years Last year, Mars bought Kellanova in adealworth $35.9 billion. The sale of WK Kellogg to Ferrero would be another upheaval in a volatile time for the snack industry, as consumer change preferences andpull backspending amid higher prices. WK Kellogg’s CEO Gary Pilnick came under fire last year for encouraging customersto eat cereal for dinneras shoppers grappled with skyrocketing food prices. CNN’s Jordan Valinsky contributed to this report.