Kellogg Co (K.US) stock jumped more than 8.0% before the opening bell after the iconic cereal producer plans to separate into three independent companies due to tax reasons.
- The company will spin off its North American cereal business and plant-based division, which accounted for about 20% of its revenue last year in two separate entities. Both groups will remain based in Battle Creek, Michigan;
- Third company will operate in snacks sector, which accounted for approximately 80% of its overall sales and will focus on business divisions such as frozen breakfast, noodles and snack foods with a new global headquarters to be based in Chicago;
- "These businesses all have significant standalone potential, and an enhanced focus will enable them to better direct their resources toward their distinct strategic priorities," said CEO Steve Cahillane.
- Kellogg said it expects the tax-free spin offs will be completed by the end of 2023. Names of the new companies have not been decided yet ;
Kellogg Co (K.US) stock rose sharply in premarket and if current sentiment prevails recent high at $75.60 may be at risk. Source: xStation5
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