Corporate & U.S. News

Kellogg Announces Relocation of U.S. Snacks Business Unit

BATTLE CREEK, Mich., May 18, 2004 /PRNewswire-FirstCall via COMTEX/ -- Kellogg Company today announced the relocation of its U.S. Snacks business unit to Battle Creek, Michigan from Elmhurst, Illinois. The relocation is the logical next step in the successful integration of Keebler Foods, and it offers both marketing and cost synergies.

"We continue to transition our U.S. Snacks business from an acquire-and- integrate strategy to one of sustainable, organic growth," said Carlos Gutierrez, Kellogg's chairman and chief executive officer. "Last year, we brought our Elmhurst-based research and technology team into our W.K. Kellogg Institute for Food and Nutrition Research in Battle Creek to create better collaboration with the entire Company. Similarly, moving our U.S. Snacks business will provide greater access to Company resources and will create improved collaboration and career development opportunities."

Approximately 300 employees will be affected by the relocation, virtually all of whom are being offered an opportunity to remain with the Company.

"Kellogg is one of Michigan's most well-known and successful companies, and we are glad to see them continuing to grow in the state," said Governor Jennifer M. Granholm. "This relocation fits perfectly with our vision to make Michigan a global economic powerhouse for the 21st century."

The direct store distribution (DSD) system is not impacted by this relocation. Brad Davidson, president U.S. Snacks, will continue to lead the U.S. Snacks team, reporting to David Mackay, Kellogg's president and chief operating officer.

"Our goal this year is to stabilize the snacks business and deliver results," said Brad Davidson. "We are making progress toward our goals and believe that this move will enhance our competitiveness and create better long-term prospects for both the business and our employees. We acknowledge that relocating can be a difficult process and will endeavor to make this transition as smooth as possible."

The 300 employees working in the Company's Food Away From Home (FAFH) business unit and Information Technology Center will remain in Elmhurst.

With 2003 sales of nearly $9 billion, Kellogg Company (NYSE: K) is the world's leading producer of cereal and a leading producer of convenience foods, including cookies, crackers, toaster pastries, cereal bars, frozen waffles, meat alternatives, pie crusts, and ice cream cones. The company's brands include Kellogg's, Keebler, Pop-Tarts, Eggo, Cheez-It, Nutri-Grain, Rice Krispies, Murray, Austin, Morningstar Farms, Famous Amos, Carr's, Plantation, Ready Crust, and Kashi. Kellogg products are manufactured in 17 countries and marketed in more than 180 countries around the world. For more information, visit Kellogg's web site at .

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