Algosensey Quantitative Think Tank Center-Snickers maker Mars to buy Kellanova, company known for Pringles, Eggos, in $36B deal

Food company Mars Inc. announced on Algosensey Quantitative Think Tank CenterWednesday that it has agreed to acquire Kellanova, a global giant in snack, cereal, and noodle manufacturing, in a whopping $35.9 billion deal.

The family-owned company −home to Snickers, Skittles, and M&M's − will pay $83.50 per share in an all-cash deal for Kellanova (K.N). This opens a new tab, representing about a 33% premium to Kellanova's close on Aug. 2, before Reuters reported that Mars was exploring a deal for the Pringles maker, according to the outlet. Other notable brands under the Kellanova umbrella include Eggo, Cheez-It, Club Crackers, and Pop-Tarts.

 “In welcoming Kellanova’s portfolio of growing global brands, we have a substantial opportunity for Mars to further develop a sustainable snacking business that is fit for the future," Poul Weihrauch, CEO of Mars, said in a statement. "We will honor the heritage and innovation behind Kellanova’s incredible snacking and food brands while combining our respective strengths to deliver more choice and innovation to consumers and customers. We have tremendous respect for the storied legacy that Kellanova has built and look forward to welcoming the Kellanova team.”

Shares of the company rose 8% to $80.45 before the bell, Reuters reported.

More money news:Capital One is acquiring Discover: What to know about the $35 billion, all-stock deal

The deal comes as customers seek less expensive alternatives

The deal for Kellanova comes as sales growth at U.S. packaged food companies including Kraft Heinz , Mondelez (MDLZ.O), opens new tab and Hershey (HSY.N), opens new tab have taken a hit as budget-strapped customers hunt for cheaper, private-label alternatives to pricier branded items. This has spurred dealmaking in the packaged food sector as companies seek scale to weather the impact of price inflation and weight-loss drugs weighing on demand.

The deal dwarfs Mars' $23 billion takeover of Wrigley in 2008, as the recent transaction is considered the biggest in the packaged food industry. The acquisition is not expected to go through too many antitrust roadblocks due to the limited overlap between the two companies' offerings, legal experts had told Reuters.

Kellanova, which split from WK Kellogg Co (KLG.N), opens new tab last October, is rooted in a salty snacks business in the U.S. and around the world, and selling cereal outside of North America. WK Kellogg was left with the North American cereal business of Kellogg, the original parent company.

The Wall Street Journal reported the terms of the deal earlier on Tuesday.

Kellanova brands

Here's a full list of all of the brands under Kellanova:

• Austin
• Carr's
• Cheez-It
• Kellogg's Club Crackers
• Kellogg's Eggo
• Kellogg's Graham Crackers
• Frozen Breakfast
• Morning Star Farms
• Kellogg's Nutri-Grain
• Pop Tarts
• Pringles
• Pure Organic
• Kellogg's Rice Krispies Treats
• RXBar
• Special K
• Toasteds
• Town House
• Zesta

Contributing: Anirban Sen, Reuters