SCHEDULE: Major Shareholder Group Commits to WK Kellogg Co Merger with Ferrero International

A significant shareholder group, including Gordon Gund and various Gund family trusts, has entered into a voting agreement to support the proposed merger of WK Kellogg Co with Ferrero International S.A.

Summary

• Gordon Gund and a group of Gund family trusts (collectively, the "Reporting Persons") beneficially own 4,670,589 shares of WK Kellogg Co Common Stock, representing 5.4% of the issued and outstanding shares as of April 30, 2025.
• The Reporting Persons have entered into a Voting Agreement with Ferrero International S.A. (Acquiror) and Frosty Merger Sub, Inc. on July 10, 2025, in connection with the proposed merger of WK Kellogg Co into a wholly-owned indirect subsidiary of Acquiror.
• Under the Voting Agreement, the Gund Trusts have committed to vote all their Common Stock in favor of the proposed Merger and against any alternative acquisition proposals.
• The agreement also includes a commitment not to solicit proxies for alternative proposals and grants an irrevocable proxy to the Acquiror to vote shares if the Gund Trusts fail to comply.
• The Gund Trusts have agreed not to sell or transfer their Common Stock, except to certain permitted transferees, until the termination of the Voting Agreement.
• The Voting Agreement will terminate upon the earliest of the Merger Agreement's termination, adverse amendments to the Merger Agreement, mutual written consent, or receipt of majority stockholder approval for the Merger.
• Gordon Gund's beneficial ownership exceeding 5% of the Common Stock was initially acquired by operation of law following the death of George Gund III on January 15, 2013.
• Agnes #3, one of the Gund Trusts, acquired an additional 699 shares of Common Stock on July 1, 2025, through a transfer from another account.

Sentiment

Score: 8

Explanation: The commitment of a significant shareholder group to support the merger is a strong positive signal for the deal's completion, reducing uncertainty for investors regarding the transaction.

Positives

• A significant shareholder group, holding 5.4% of outstanding shares, has committed to vote in favor of the proposed merger, increasing the likelihood of its successful completion.
• The Voting Agreement includes an irrevocable proxy, providing the Acquiror with assurance regarding the voting of these shares.

Negatives

• The Voting Agreement restricts the Gund Trusts from selling or transferring their Common Stock, limiting their liquidity and flexibility until the merger is completed or the agreement terminates.
• The agreement also prevents the Gund Trusts from soliciting alternative acquisition proposals, potentially limiting the Issuer's ability to receive higher bids.

Risks

• The Voting Agreement will terminate if the Merger Agreement is terminated, if there are adverse amendments to the Merger Agreement, or if the merger does not receive majority stockholder approval, which could lead to uncertainty regarding the future of the shares held by the Reporting Persons.
• If the merger is not completed, the Reporting Persons expect to continue holding the Common Stock for investment purposes, but may reconsider their position or formulate new plans, which could introduce future volatility.

Future Outlook

The Reporting Persons acquired and currently hold the Common Stock for investment purposes. If the proposed merger is not completed or the Voting Agreement is terminated, the Reporting Persons expect to continue holding their Common Stock for investment, though they may review or reconsider their position and/or change their purpose and/or formulate new plans or proposals regarding their holdings at any time.

Industry Context

This filing signals a significant step towards the consolidation of WK Kellogg Co, a major player in the cereal industry, under the ownership of Ferrero International S.A., a global confectionery and packaged food company. Such a merger could lead to shifts in market dynamics and competitive landscapes within the broader food sector.

Corporate Governance

Related Party Transactions

• Gund #7 entered into loan agreements with KeyBank National Association, as lender, for a demand line of credit of $20 million, collateralized by a blanket lien on all assets held by Gund #7. KeyBank National Association also serves as trustee for the Gund Trusts.

Stakeholder Impact

• Shareholders: The commitment of a major shareholder group to the merger increases the likelihood of the transaction closing, which could provide a defined exit price for other shareholders, assuming the merger consideration is attractive.
• Acquiror (Ferrero International S.A.): The voting agreement provides certainty of support from a significant shareholder block, facilitating the merger process.
• WK Kellogg Co Management: The agreement simplifies the process of securing shareholder approval for the merger.

Next Steps

• The Issuer and Acquiror will proceed with the terms and conditions of the Merger Agreement.
• The Gund Trusts will vote their Common Stock in favor of the proposed Merger and against any alternative acquisition proposals, as per the Voting Agreement.
• The Merger will proceed towards completion, subject to the terms and conditions of the Merger Agreement and receipt of majority stockholder approval.

Key Dates

Recommendation

Keywords

WK Kellogg Co, Ferrero International S.A., Merger Agreement, Voting Agreement, Schedule 13D, Beneficial Ownership, Shareholder Group, Corporate Acquisition, Common Stock, Investment