U.S. Snacks bolstering manufacturing capacity through acquisition

Our U.S. Snacks business is bolstering its manufacturing capacity through an acquisition announced in September that adds two plants to its supply chain network.

Kellogg has acquired the assets of IndyBake Products LLC and Brownie Products Co., a privately held contract manufacturing business that produces cracker, cookie and frozen dough products. Terms of the transaction - which includes the company's plants in Seelyville, Ind., and Gardner, Ill. - weren't disclosed.

"Expanding our Snacks business is a key element of Kellogg's business strategy and commitment to driving sustainable growth," President and CEO David Mackay says in a press release announcing the transaction, which closed Aug. 29. "This acquisition will help us expand our capacity to manufacture existing and proprietary snacks products as well as enable new product innovations."

According to Alistair Hirst, Senior Vice President, U.S. Snacks Supply Chain, the decision to acquire IndyBake Products and Brownie Products was driven by the need to boost our existing cracker manufacturing capacity to meet future consumer demand.

"As a result, we decided that the most effective approach to increasing our capacity was to acquire an existing snacks manufacturing business," Alistair says.

The Seelyville facility has 183,000 square feet of manufacturing space, while the Gardner facility has 96,000 square feet. The two plants have a total of about 150 production employees, including both salaried and hourly personnel, all of whom we anticipate will join Kellogg upon closing.

"We've enjoyed a positive working relationship with them for years as a contract manufacturing partner," Alistair adds. "The previous owners tell us they felt Kellogg was a good fit for their business and would enable continued growth."

This acquisition is consistent with our strategy of pursuing selective growth opportunities, including those that help us to expand our existing infrastructure.