Kellogg competitor bows out of bid for Egyptian baked goods maker BiscoMisr

Industries Associated Press

Shares of Kellogg slipped Wednesday morning after a Middle Eastern private equity investor said it was dropping out of a bidding competition with the U.S. cereal maker over an Egyptian baked goods manufacturer.

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The Abraaj Group said it was bowing out after making an offer last week of 88.09 Egyptian pounds ($12.36) for each share of BiscoMisr. That bid totaled about $142.1 million.

The private equity firm said Kellogg then increased its bid to $89.86 Egyptian pounds per share, or $12.60 per share.

A Kellogg representative confirmed the amount of the company's most recent bid for a majority stake in BiscoMisr but declined to comment further until that offer closes on Jan. 11.

The Battle Creek, Michigan, company makes Frosted Flakes and Special K cereals, Pop Tarts and Eggo waffles, among other products. It has been contending with slumping cereal sales and growing competition in the breakfast category from alternatives like yogurt or fast-food breakfast sandwiches.

The company has been cutting costs and said late last year that it would cut its global work force by 7 percent.

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Kellogg Co.'s stock slid 44 cents to $66.18 Wednesday morning, while broader indexes climbed slightly. The stock had advanced about 9 percent so far this year, as of Tuesday.