Kellogg Co. agreed to buy a 50 percent stake in Nigerian food distributor Multipro for $450 million and is creating a joint venture with Tolaram Africa to help expand on the continent.
The Tolaram venture includes an option for Kellogg to buy a stake in the African company in the future, the Battle Creek, Michigan-based foodmaker said in a statement Tuesday. Costs associated with the Multipro deal will reduce earnings per share by 1 cent in the third quarter, Kellogg said.
Kellogg, the maker of Froot Loops and Corn Flakes cereals, is looking abroad for growth as more Americans eat breakfast away from home or eschew cereal for options like Greek yogurt. Chief Executive Officer John Bryant said in the statement that sub-Saharan Africa is a "tremendous opportunity" for Kellogg, with a population of almost 1 billion and an economy expected to more than double in the next 10 years.
Kellogg’s shares rose 1.1 percent to $67.46 at the close in New York. The stock has gained 3.1 percent this year.