Kraft Heinz is in discussions to sell its Planters snack unit to Skippy peanut butter manufacturer Hormel Foods to the tune of $3 billion, Reuters reported on Wednesday, citing sources with knowledge of the matter.
A deal, which will value the hundred-year-old brand at about $3 billion, could be made public next week, assuming the meeting doesn't fall apart, the Wall Street Journal reported.
Kraft Heinz and Hormel did not issue any comment regarding the report.
Planters mainly sells nuts and other snack products, with labels featuring the top hat-donning and monocle-wearing Mr. Peanut logo.
Stocks of Hormel, which has a market value of $26.3 billion, rallied more than 6% following the report before ending up almost 4% at $48.75, Tuesday. Stock of Kraft Heinz advanced 13.6% over the past four quarters, giving the company a $40.5 billion market value.
Hormel has diversified in recent years by acquiring companies like Sadler's Smokehouse for $270 million in 2020 and Justin's Nut Butters for $286 million in 2016.
Planters would be the latest addition to Hormel's portfolio that includes chilies, deli meat products and condiments. A Planters deal would be by far Hormel's biggest to date, the Journal said.
As part of the company's multi-year turnaround campaign, Kraft Heinz has also been slashing less in-demand products from its inventory and divested part of its cheese business to Lactalis for $3.2 billion.
Kraft's buyout of Nabisco Brands in 2000 brought the nut brand into the company's portfolio, then Kraft and Heinz consolidated in a 2015 megadeal.
While Mr. Peanut has often been featured in Super Bowl commercials, Kraft Heinz said that the $5 million it would normally set aside for game ads will instead be given to people as reward for their charitable efforts.
