Mars' $36B Kellanova Deal: Analysts See Minimal Category Overlap, No Competing Bids

M&A Transaction Overview - Mars, Inc. has agreed to acquire Kellanova K for $83.50 per share, representing a 44% premium over its 30-day average price, with a total transaction value of $35.9 billion, expected to close in the first half of 2025, pending shareholder and regulatory approvals [1] Analyst Insights - RBC Capital Markets analyst Nik Modi downgraded Kellanova from Outperform to Sector Perform, raising the price forecast to $83.50 from $76, aligning with the acquisition price [1][2] - Piper Sandler analyst Michael S. Lavery maintained a Neutral rating on Kellanova, increasing the price forecast to $83 from $63, anticipating no competing bids or closure issues due to minimal category overlap [1][2] Regulatory Considerations - Analysts expect antitrust clearance for the deal, citing minimal category overlap, particularly in wholesome snack bars, where Mars holds approximately 11% market share compared to Kellanova's ~5% [3] - The fragmented nature of the snacking category and low entry barriers suggest minimal risk of increased brand pricing post-acquisition [4] Earnings Projections - Modi projects FY24 EPS for Kellanova at $3.62 and FY25 EPS at $3.92 [2] - Lavery maintains FY24 EPS at $3.70 and FY25 EPS at $3.79 [3]