Mars Considers Purchase of Kellanova

Mars, whose candy brands include M&M's, Twix, Skittles, Starburst, and Snickers, is exploring a potential acquisition of Kellanova, maker of snacks such as Cheez-It and Pringles, according to sources.

A deal would be one of the biggest ever in the packaged food sector, given Kellanova's market value of about $27 billion including debt, and test the appetite of regulators to allow consolidation in the sector.

Shares of Kellanova shot up Monday, after the news. Shares have been up about 20% since it split from WK Kellogg Co. last October, Reuters stated, but are still trading at a discount to some of its peers, such as Hershey and Mondelēz  International, making it a potential acquisition target.

There is no certainty that Kellanova will pursue a deal with Mars, the sources said. Another suitor could also approach Kellanova, and it's possible that no deal with any party is reached, the sources added, requesting anonymity because the matter is confidential.

If this goes through, the deal would be one of the largest in the industry in years.