Investing.com - Shares of WK Kellogg (NYSE: KLG ) surged by more than 57% in premarket trading after the Wall Street Journal reported that family-owned Italian candy group Ferrero is closing in on a roughly $3 billion deal to buy the cereal maker.

Citing people familiar with the matter, the WSJ reported that Ferrero -- the company behind brands like Ferrero Rocher and Nutella -- could finalize the deal for WK Kellogg as soon as this week should there be no last minute wrinkles in the negotiations.

A deal would bring Ferrero together with WK Kellogg, the firm famous for its breakfast cereals like Froot Loops and Rice Krispies that have become supermarket staples.

Ferrero has been on the hunt for U.S. acquisitions as it eyes international expansion and growth in its offerings. It has previously purchased Blue Bunny-manufacturer Wells Enterprises and rival Nestle’s U.S. chocolate unit.

WK Kellogg is facing a shift in behavior among inflation-hit and more health-conscious shoppers as well as a backlash to its use of artificial food dyes in some of its products.

The company is itself a result of Kellogg spinning off its North American cereal business around two years ago. It later sold its remaining snacking division, dubbed Kellanova (NYSE: K ), to Mars for over $30 billion in 2024.

Deals in the snack foods industry have been more common, with recent transactions including J.M. Smuckers’ buy of Twinkies-maker Hostess Brands (NASDAQ: TWNK ) and packaged food giant PepsiCo (NASDAQ: PEP )’s acquisition of tortilla chip firm Siete Foods.

On Wednesday, WK Kellogg shares ended trading at $17.50, giving it a market capitalization of about $1.51 billion.