P&G has now agreed a new deal with Kellogg for the business, which is expected to be completed in the summer. Kellogg confirmed that the acquisition would “significantly advance” its goal of building a global snacks business on par with its global cereal business.
Kellogg president and ceo, John Bryant said: “We are excited to announce this strategic acquisition. Pringles has an extensive global footprint that catapults us to the number two position in the worldwide savoury snacks category, helping us achieve our objective of becoming a truly global cereal and snacks firm.”
“We are delighted to welcome the employees of the Pringles organization to Kellogg. Their collective passion and commitment has resulted in Pringles' well-deserved acclaim as one of the most recognized brands in the world."
The news came as no surprise to Julian Wild, food group director at law firm Rollits. He told FoodManufacture.co.uk that since Diamond had dropped out, the price of the business meant a bid from one of the multi-nationals was likely.
He said: “It struck me that it was likely to be one of the multi-nationals. It certainly doesn’t surprise me as it would have to be one of those players, considering the price that the business was going for.
“It is a big punt into the snacks market and for the sort of money we are talking about, it was always going to be one of them.”
The news follows the termination of the previous deal with Diamond, which had been in doubt since last April after Diamond announced an investigation into its own accounting. This resulted in the departure of its chief executive and chief financial officer.
Diamond Foods' acting president and chief executive officer Rick Wolford said: “Diamond Foods today announced that P&G and Diamond have mutually agreed to terminate our proposed acquisition of the Pringles business and have released each other from all liabilities related to the proposed acquisition. No ‘break-up’ or other fees will be paid in connection with this termination.”
Diamond has enjoyed a positive and constructive working relationship with P&G throughout this process, and the mutual termination of our agreement and release of all associated liabilities was reached in the same spirit.”
Wolford added that Diamond would now be focusing its efforts on continuing to grow its existing brands.