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Mondelez Creates Snack Bar Giant with $2.9B Clif Bar Acquisition
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Mondelez Creates Snack Bar Giant with $2.9B Clif Bar Acquisition

Story Highlights

Mondelez wants to win the future of snacking. Its latest move further bolsters its recent string of acquisitions.

Global food and beverage products provider Mondelez International Inc. (MDLZ) has agreed to acquire nutritious energy bar maker Clif Bar & Company for a consideration of $2.9 billion with a further contingent payout.

The move boosts Mondelez’s global snack bar presence with the addition of the Clif, Luna, and Clif Kid brands. This also bolsters Mondelez’s strategy to remodel its portfolio toward higher long-term growth.

The Chairman and CEO of Mondelz, Dirk van de Put, said, “This transaction further advances our ambition to lead the future of snacking by winning in chocolate, biscuits, and baked snacks as we continue to scale our high-growth snack bar business.”

Sally Grimes, the CEO of Clif Bar and Co., added, “Our purposes and cultures are aligned, and being part of a global snacking company with broad product offerings can help us accelerate our growth while staying true to our deeply ingrained aspirations.”

Additionally, Mondelez’s scale is expected to drive Clif’s sales distribution and expand its market penetration. The acquisition is also expected to create cost synergies and be top-line accretive in the second year. The transaction is expected to close in the third quarter.

Mondelez remains on a drive to prioritize its fast-growing snacking units in major geographies. In the past two years, it has acquired Ricolino (confectionary), Chipita S.A. (cakes and pastries), Grenade (nutrition), Gourmet Food Holdings (biscuits and crackers), and Hu (snacking).

Analyst’s Take

The Street remains Bullish on the stock with a Strong Buy consensus rating and an average Mondelez price target of $72.18, which implies 22.7% upside potential.

Barclays analyst Andrew Lazar has reiterated a Buy rating on the stock with a price target of $76, implying a 29.23% potential upside. That’s after a nearly 11% slide in share prices so far in 2022.

Closing Note

With this move, Mondelez has expanded its global snack bar business to more than $1 billion. The company is focusing on the snacking category, which is experiencing high growth. The strategic moves are a further step toward enhancing shareholder value.

Disclosure

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