Mars, the renowned family-owned confectionery giant known for brands like M&M's and Snickers, has announced its intention to acquire Kellanova, the producer of Cheez-It and Pringles, in a landmark all-cash deal valued at nearly $36 billion. This acquisition marks the largest in the packaged food industry’s history.

Mars will offer $83.50 per share for Kellanova, representing a 33% premium over the company's closing price on August 2, prior to the news of the acquisition discussions. Following the announcement, Kellanova's shares surged 8% to $80.45 in pre-market trading.

The acquisition comes amid a period of slow sales growth for major U.S. packaged food companies like Kraft Heinz, Mondelez, and Hershey. This slowdown is attributed to consumers shifting towards cheaper, private-label products instead of pricier branded items. As a result, there has been an uptick in dealmaking within the sector as companies aim to expand their scale to better navigate inflation and changing consumer trends.

Mars' purchase of Kellanova eclipses its previous largest deal, the $23 billion acquisition of Wrigley in 2008. This new deal will expand Mars' portfolio to include Kellanova’s popular snack products, such as Pop-Tarts, Rice Krispies Treats, and Eggo waffles, alongside Mars' existing confectionery brands like Twix, Bounty, and Milky Way.

Legal experts anticipate that the acquisition will face minimal antitrust scrutiny, due to the limited overlap between Mars' and Kellanova’s product lines.

Kellanova, which spun off from WK Kellogg Co last October, focuses on salty snacks globally and cereal sales outside North America. WK Kellogg retained the North American cereal operations of the original Kellogg company.

The details of the deal were initially reported by The Wall Street Journal earlier this week.