To celebrate the long-planned division, Kellanova CEO Steve Cahillane and other members of the company’s executive leadership team rang the opening bell of the NY Stock Exchange this morning, where it will continue to trade under the ticker K and where WK Kellogg Co will begin regular way trading today under the symbol KLG.
“With the completion of the separation, Kellanova has entered into a new era with a new name and a new ambition,” Cahillane said in a release.
With $13bn in net sales in 2022, excluding those from cereal brands that will go to WK Kellogg Co, and strong margins and cash flow, Cahillane added the new company is “starting from a position of strength that is rooted in a century-old legacy as we embark on a journey to achieve our vision of becoming the world’s best performing snacks-led powerhouse.”
Kellanova adopts ‘differentiate, drive and deliver’ strategy
To do this, he explained earlier this summer, that Kellanova will focus on a strategy to “differentiate, drive and deliver,” which will include heavy investments in a global awareness marketing campaign that will include introducing more small- and multi-pack options and increased penetration in high frequency stores, including mom and pop shops.
It also plans to drive sales and consumer engagement through differentiated innovation that goes beyond new flavors and into new platforms – a move that is possible now that supply disruptions are receding, Cahillane said in August.
To further ensure consumer recognition and engagement, the Kellogg’s brand will remain on its products around the world, despite the company name-change.
These steps should help Kellanova reach a projected $13.4-$13.6bn in net sales in 2024, the company predicts.
WK Kellogg Co will focus on regaining recently lost market share, sales
As part of the separation, investors received one share of WK Kellogg Co common stock for every four shares of Kellanova common stock held at the close of business Sept. 21.
WK Kellogg Co plans to grow its $2.7bn iconic cereal business by embracing a three-prong strategy that new CEO Gary Pilnick told investors this summer would help it recover losses related to “significant disruption” from a fire at the Memphis facility and a high-profile strike at all the US cereal plants.
He explained, the strategy incudes integrating its global cereal business under one umbrella to take advantage of economies of scale, modernizing its supply chain by investing in technology and automation, and building an “energized and winning culture” in which employees will follow a “make it better” mindset.