Food companies Hostess Brands, B&G Foods and Ferrero have placed bids in the first round for the acquisition of Kellogg’s Keebler, Famous Amos and fruit snack units.
A deal could potentially be worth more than $1.5bn.
In 2018, Kellogg announced its intention to divest its snack brands, including Mother’s Cookies and the Stretch Island Fruit brand.
According to CNBC reports, private investment firms are also competing for these businesses.
Kellogg competitor Campbell Soup is also divesting its Australian cookie brand Arnott’s.
Campbell’s cookie brand has attracted bids from Ferrero, Mondelez and Kraft Heinz, CNBC reported.
Kellogg, Kraft Heinz, General Mills and Campbell are among the major food companies that are slimming down their portfolios to spur growth.
In 2018, Heinz announced plans to sell its Indian food business Complan.
These divestments have enabled firms such as Ferrero to widen their market through established brands.
Italy-based Ferrero has been aggressively expanding its presence in the last two years.
In 2017, it bought US-based Ferrara Candy Company, which owns brands such as Red Hots and Now & Later candies, for $1bn. It also acquired Nestle’s US candy business for $2.8bn.
Hostess has been looking to expand its portfolio beyond Twinkies and Ho-Hos.
In February 2018, Hostess executive chairman Dean Metropoulos said that the firm had looked at every snack acquisition announced that year but was discouraged by high valuations.
In 2018, it acquired breakfast brands Big Texas and Cloverhill from Aryzta.
In 2015, B&G acquired Green Giant from General Mills for $765m. In 2018, it acquired McCann’s Irish oatmeal from TreeHouse Foods for $32m.
