Kellogg plans to split into 3 companies to unleash the power of its snack biz — and reinvigorate its cereal

Pringle and ready to mingle… Frosted Flakes and Pringles are breaking up. Cereal icon Kellogg said it’s splitting into three publicly traded companies: snacks, cereal, and plant-based meat (think: MorningStar patties). Kellogg became a snack giant thanks to faves like Cheez-Its and RxBars. Now it’s spinning off categories in hopes that specificity will boost profitability. The three biz lines are expected to go solo next year.

• Pop Tart-ed: Kellogg stock popped 2% yesterday and is up 6% this year as shoppers keep buying Rice Krispies despite inflation and smaller boxes (#shrinkflation).

Cereal killer… Kellogg’s cereal sales have been slipping for years as Americans ditch Fruit Loops for less neon-colored options. But snacking is on the up and up after spiking during lockdowns. Now:

• Snacks make up 80% of Kellogg’s sales and are growing faster than cereals and plant-based foods. Snacks boosted Kellogg’s profit last quarter, so it’s spinning them off to double down.
• Solo snacks have succeeded before: A decade ago, Kraft spun off its snack brands (Oreo, Triscuits) into a new public company called Mondelez: today Mondelez’s market cap is twice Kraft-Heinz’s — and now it's buying Clif Bar for nearly $3B.