Ferrero Expands Beyond Confectionery With $1 Billion Move Into Breakfast Cereal

The Ferrero family, long synonymous with iconic sweets like Nutella and Kinder, is making a major move beyond its confectionery roots, Bloomberg reports.

The Italian food giant is reportedly set to acquire WK Kellogg Co., the breakfast cereal maker behind brands like Froot Loops, Rice Krispies, and Corn Flakes, in a $1 billion deal that would mark the largest acquisition in Ferrero’s 79-year history.

The planned purchase reflects a broader shift in strategy for Ferrero as it seeks to diversify its $50.4 billion fortune, reduce exposure to volatile cocoa markets, and strengthen its position in North America. The move mirrors a similar trend among Ferrero’s largest competitor, Mars Inc., which acquired Kellogg’s former snack division, Kellanova, for $36 billion last year.

Although cereal sales have declined in recent years, some industry experts see Ferrero’s pivot as timely.

“The cereal aisle isn’t the destination it used to be, but for Ferrero this may also be why this acquisition makes perfect sense,” said Mitchell Olsen, a marketing professor at the University of Notre Dame.

With cereal increasingly consumed as a snack, Ferrero could find new relevance through brand mashups and crossover flavors.

The deal gives Ferrero — best known for Tic Tacs, Ferrero Rocher, and its signature cocoa-hazelnut products — entry into the breakfast category, where it has historically had limited presence outside of Nutella. The acquisition also aligns with Ferrero’s ongoing efforts to diversify its portfolio, which has expanded in recent years to include cookies, ice cream, and protein bars.

Bloomberg Intelligence analyst Duncan Fox noted that the move “helps Ferrero establish a presence in yet another new grocery category” and positions the company for potential growth even as traditional sugary snacks face headwinds.

Ferrero and Mars are both responding to broader challenges affecting the global food industry. The surging cost of cocoa, driven in part by supply disruptions and climate change, is increasing production costs for chocolate-heavy portfolios. Meanwhile, GLP-1 weight loss drugs, such as Ozempic, are reshaping consumer behavior. A Bloomberg Intelligence survey of users found a 71% drop in candy consumption and a 34% increase in fresh produce intake.

The companies also face growing regulatory scrutiny. US Health Secretary Robert F. Kennedy Jr. has called for the removal of synthetic food dyes—an ingredient found in several Mars and Kellogg products.

The acquisition also underscores a striking transformation in two of the world’s largest family-run food empires. While Ferrero’s origins lie in postwar Italy, Mars — a $54.6 billion company owned by a family worth over $140 billion — has gradually shifted its focus to pet care and savory snacks.

Ferrero’s own diversification efforts have been led by Giovanni Ferrero, son of the company’s late, famously private CEO Michele Ferrero, often likened to the fictional Willy Wonka. Giovanni became sole CEO in 2011 following his brother’s passing and stepped down in 2017 to become executive chairman. Under his leadership, the company has completed more than a dozen deals, including the 2023 purchase of US candy maker Jelly Belly.

In addition to his role at Ferrero, Giovanni runs CTH, a private investment firm focused on food-sector deals across Europe and the US.