BATTLE CREEK, Mich. – On Tuesday, the Kellogg Company announced that the headquarters will transition to a duel campus being shared in Battle Creek and Chicago. The cereal company also announced its plans on separating into three independent companies to focus on particular strategic priorities. Currently, there are about 2,000 employees that work out of Battle Creek.
The three companies will temporarily be known as “Global Snacking Co.,” “North America Cereal Co.” and “Plant Co.”
The North America Cereal Co. and Plant Co. are said to remain in Michigan as the Glocal Snacking Co. will be part of the duel campuses in Battle Creek and Chicago. The company writes in a press release that the separations with the divisions is to help create greater financial, operational and strategic focuses on each of the companies and its stakeholders.
“When you have a Kellogg Cereal company that can focus on just cereal and not have to fight with Cheez-It or Pringles for resources it has bright days ahead of it,” said CDO Steve Cahillane. Cereal sales only make up 20% of the company’s profits. Kellogg’s CEO says they see this as a chance to refocus on its investment.
Kellogg’s states that these newly independent companies will be in a better position to focus on these strategic priorities which can help with operational flexibility allowing the separate companies to focus on resources, help improve profitable growth and to shape corporate cultures with Kellogg Company’s rooted values.
“Kellogg has been on a successful journey of transformation to enhance performance and increase long-term shareowner value. This has included re-shaping our portfolio, and today’s announcement is the next step in that transformation,” said Steve Cahillane, Kellogg Company’s Chairman and Chief Executive Officer. “These businesses all have significant standalone potential, and an enhanced focus will enable them to better direct their resources toward their distinct strategic priorities. In turn, each business is expected to create more value for all stakeholders, and each is well-positioned to build a new era of innovation and growth.”
Below are the separate companies’ focuses and net sales:
- Global Snacking Co.
- This division which is now a separate company has $11.4 billion* in net sales and is set to be a leading company in global snacking, international cereal and noodles and North America frozen breakfast. In the press release, the company states that its world-class brands have strong underlying growth momentum and profitability.
- North America Cereal Co.
- This division which is now a separate company has $2.4 billion* in net sales and is set to be a leading cereal company in the U.S., Canada and the Caribbean. Kellogg’s states that this newly separated company has a portfolio of world-class brands with opportunities for investment and profit growth.
- Some of the brands under this company are Kellogg’s, Frosted Flakes, Froot Loops, Mini-Wheats, Special K, Raisin Bran, Rice Krispies, Corn Flakes, Kashi and Bear Naked.
- Plant Co.
- This division which is now a separate company has $340 million* in net sales and is set to be leading in profitable plant-based foods. Kellogg’s states that there are significant opportunities for this newly separated company to invest in furthering North America’s international expansion.
* All net sales are based on the Kellogg Company’s 2021 unaudited results derived from internal management reporting, further adjusted for splits by brands and markets, as well as preliminary cost and expense allocations, including corporate expenses; these figures will be refined prior to the transactions.