Kellogg Company announced Monday in Qingdao that a majority-owned subsidiary of Kellogg Company acquired substantially all assets of Zhenghang Food Company (Navigable Foods), which produces snack products under the ZhengHang brand.

Jeff Boromisa, chairman of Kellogg's Asia and Pacific region, shakes hands with Gao Guijia, chairman of Zhenghang Food Company after Zhenghang's strategic development news conference yesterday. [China Daily]

Sale price and financial terms of the transaction were not revealed.

The acquisition includes Zhenghang's two manufacturing bases located in Shandong Province and Liaoning Province, as well as the company's sales and distribution network.

After the acquisition, Zhenghang's approximately 1,800 staff members, including its entire management team, will join the subsidiary of Kellogg Company.

Established in 1993, Zhenghang has become a leading producer of cookie and cracker snacks in the north and northeastern regions of China. The company's net sales in 2007 were $50 million.

Kellogg Company is the first Fortune 500 company to invest in Yishui County, where Navigable Foods' main plant is located.

With 2007 sales exceeding $11 billion, Kellogg Company is the world's leading producer of cereal and a leading producer of snack foods, including cookies, crackers, toaster pastries, cereal bars, fruit snacks, frozen waffles and veggie foods. Kellogg products are manufactured in 17 countries and marketed in more than 180 countries throughout the world.

"Geographic expansion in high-growth markets like China will help Kellogg Company continue to deliver sustainable growth. Navigable Foods' biscuit products are a strong, strategic fit within the Kellogg portfolio and will further build our presence in China," said David Mackay, Kellogg Company's president and chief executive officer, in a press release.