November 26, 2024 16:07 GMT
CONSUMER STAPLES: Mars acquisition of Kellanova; Supply may come soon (bbg)
CONSUMER STAPLES
(K; Baa2 CW Pos/NR/BBB CW Pos) (MARS; A1 CW Neg/A+ CW Neg)
It was a $35.9b purchase funded by a $29b bridge-loan. Mars is currently a $ only issuer and below does not clarify which currencies it may tap for refi. It does hint at timing as potentially December but more likely as early next year (citinginsiders).
K should get a +3 notch uplift and will go private, Mars is facing -1 notch downgrade. It will take under its wing Pringles, Cheez-It and NutriGrain among others - only a year after Kellogg split the snacks (K) and NA Cereal business (KLG) into two. Mars is known for Snicker, m&m and Extra snacks but it generates most (60%) of its revenue from Pet-food/care.
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