WK Kellogg Co., the cereal giant, is set to be acquired by the Italian candymaker behind Ferrero Rocher in a nearly $3 billion deal, the Wall Street Journal reported Wednesday.

A deal with parent Ferrero SpA, the maker of Butterfinger candy bars and Nutella hazelnut spread, could be finalized as soon as this week, according to reports.

Shares in Kellogg, the Battle Creek, Michigan-based maker of Frosted Flakes, Froot Loops and other breakfast cereals, closed Wednesday at $17.50, but skyrocketed more than 50% in after-hours trading on news of a prospective deal.

Phone and email requests by The Detroit News to Ferrero in Italy and Kellogg in Battle Creek were not immediately returned Wednesday.

The deal, if confirmed by the companies, would mark another potential loss for corporate Michigan and its ability to retain such heritage companies as Kellogg. Historically, acquisitions of Michigan companies lead to fewer jobs and less local investment.

Kellogg, which has a market value of roughly $1.5 billion and about $500 million in debt, employs nearly 700 people in Michigan, according to recent reports. Two years ago, the landmark cereal maker was split into two companies — Battle Creek-based WK Kellogg and Kellanova, based in Chicago and Battle Creek, which announced a nearly $30 billion sale to Mars Inc. last year.

Under the split, officials said then, WK Kellogg would focus on cereals like Froot Loops and Frosted Flakes in North America, while Kellanova would focus on snack foods and growth opportunities in foreign markets.

"WK Kellogg Co. has a 117-year legacy of innovation and the soul of a start-up, with an organization incredibly energized by our future," Gary Pilnick, WK Kellogg Co.'s chairman and CEO, said in September 2023 when the separation was formally approved.

"As a standalone company, we will benefit immediately from the executional advantages of increased focus and end-to-end integration, while we modernize our supply chain and substantially improve our profit margins. We're on a profitable journey to take this great business to the next level."

WK Kellogg has been under scrutiny in the United States amid U.S. Secretary of Health and Human Services Robert F. Kennedy Jr.'s criticism of artificial dyes in food. Texas Attorney General Ken Paxton in April launched an investigation into dyes in Kellogg cereals.

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