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Kellanova (BBB); Mars (A1/A+) potential bidder, composite rating uplift, expect Mars supply

CONSUMER STAPLES
  • K stock finished +16% while Mars lines moved +5 in the belly and +14 on long-end (spread to swaps).
  • $Kellanova was unch to tighter (vs. $IG +6) while our lines were +2+5 (vs. €IG +10).
  • We are trading flat now to $K's but arguably have tad more protection given less risk of Mars supply locally.
  • No firm view on levels here, its -5bps through equal rated GIS curve. Upside looks limited to HSD tightening on deal close and note you will switch into a private co.

Our thoughts from Reuters reports earlier here

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