Mars, the privately-held confectionery and petcare giant, has reached an agreement to acquire Kellanova, the maker of Pringles and Pop-Tarts, in a deal valued at more than $29 billion.

The acquisition, expected to be announced on Wednesday, marks one of the largest corporate transactions of the year.

Under the terms of the agreement, Mars will pay $83.50 per share in an all-cash deal for Kellanova, representing a significant premium of nearly 33 per cent to the company's closing price on 2 August. Mars will also assume £4.9bn in net debt as part of the transaction.

The deal brings together Mars' portfolio of popular brands, including M&M's, Snickers, and Twix, with Kellanova's range of snacks such as Cheez-It, Rice Krispies Treats, and Eggo frozen waffles. The combined entity is poised to become a powerhouse in the global snack and confectionery market.

Mars, one of the world's largest family-owned businesses, boasts annual sales exceeding $50bn and a workforce of more than 150,000 employees. The acquisition of Kellanova represents the company's largest-ever deal, surpassing its $23bn takeover of Wrigley in 2008.

The move comes at a time when US packaged food companies have faced challenges due to budget-conscious consumers seeking cheaper alternatives amidst inflationary pressures. However, Kellanova has managed to navigate the slowdown in consumer spending, recently raising its full-year sales forecasts after exceeding expectations in its latest earnings report.

The proposed acquisition is likely to face scrutiny from antitrust regulators, particularly given the aggressive stance of competition watchdogs appointed by President Joe Biden's administration.

As the news broke, Kellanova's shares rose 8 per cent to $80.54 in premarket trading on Wednesday, reflecting investor optimism about the deal.

The transaction is expected to close following regulatory approvals and other customary closing condition

---