Kellogg, a major player in the packaged food industry in the US and globally, has managed all its brands under a single umbrella for over a century. However, today, the company announced a significant change in its structure.
The CEO of Kellogg, Steve Cahillane, revealed the decision to split the company into three separate units, each operating as an independent company responsible for a specific category of Kellogg’s food offerings. The first unit will handle Kellogg’s famous cereal brands like Corn Flakes and Special K. The second unit will focus on snacks such as Pringles and Cheez-Its. The third unit will oversee Kellogg’s organic products, including brands like Kashi and Incogmeato.
Cahillane stated, “Kellogg has been working towards improving performance and delivering long-term value to shareholders. These businesses have strong potential on their own, and by giving them more focus, they can better pursue their unique strategic goals.”
Following this announcement, Kellogg’s stock experienced an 8% increase in value. The company has seen substantial profits in recent years from snack items like Nutri-Grain bars, Pop Tarts, and Pringles. Analysts anticipate that the snack-focused unit will be the most lucrative among the three, and operating independently could enable it to pursue further growth without constraints from other product lines.
Image Source: Unsplash
