Kellogg Shares Spike After the Company Announces Its Game-Changing New DirectionKellogg is revamping its business strategy as it aims to transform its portfolio.
ByAmanda Breen•
Many companies have had to adapt in the face of thepandemicandsupply-chainchallenges, andKelloggis one of the latest to switch up its business strategy.
该公司announcedTuesday that it will separate into three independent companies, transforming its cereal and plant-based businesses into distinct entities and keeping the focus of its remaining business on snacking, cereal and noodles across the globe, and frozen breakfast in North America.
PerCNBC, Kellogg shares soared 6.5% in premarket trading on the announcement.
“这些企业都有显著的独立potential, and an enhanced focus will enable them to better direct their resources toward their distinct strategic priorities," Steve Cahillane, Kellogg Company's chairman and CEO, said in the statement. "In turn, each business is expected to create more value for all stakeholders, and each is well-positioned to build a new era of innovation and growth."
The businesses have yet to be named, and management teams for the new businesses have yet to be announced.
Kelloggis also considering the eventual sale of its plant-based business. Together, the company's plant-based and cereal businesses account for just 20% of Kellogg's total revenue. Kellogg's global snacking business and North American frozen breakfast brands, which include brands such asPringlesand Eggo, make up the rest, bringing in $11.4 billion last year.
Cahillane will stay on as CEO of the global snacking company, and headquarters for the three businesses will remain the same. The North American cereal company, which includes brands such as Froot Loops and Special K, and the plant-based food company are located in Battle Creek, Michigan, and the global snacking company is in Chicago, with an additional campus in Battle Creek.
Related:Over 1,000 Kellogg's US Cereal Plant Workers Go on Strike Over Cut to Benefits and Pay
Kellogg Company is up 7.5% year over year this morning, and Cahillane told CNBC that the company has yet to determine how it will allocate its dividends among the three businesses.
