-Private equity firm Cerberus Capital Management, which owns a stake in grocer Albertsons, and billionaire investor Dean Metropoulos teamed up in an unsuccessful bid for cereal maker WK Kellogg, according to three sources familiar with the matter.

The consortium, which was being advised by investment banks UBS and Macquarie Capital, ultimately lost out to private, family-owned Ferrero Group, which on Thursday announced an agreement to acquire WK Kellogg for around $3.1 billion.

However, the offer from Cerberus and Metropoulos was considered a serious alternative to Ferrero and has caused industry insiders to wonder about a possible future target for the pair, two of the sources said. Both Cerberus and Metropoulos have histories of investing in the food industry.  

WK Kellogg, Cerberus, UBS and Macquarie declined to comment. Metropoulos & Co did not immediately respond to a comment request.

Dealmaking in the food space has picked up steam in recent months as owners focus on core names and offload underperforming brands. There has been a relatively steady supply of buyers for these divestments, aiming to turn around their fortunes.

Cerberus is the top shareholder in grocery chain Albertsons, but it has not made a big bet on a consumer or retail company in years. Its offer for WK Kellogg shows the firm still has a desire to invest in the sector, the sources said.

Meanwhile, the investment firm of Greek-American billionaire Metropoulos - Metropoulos & Co - acquired Nestlé Waters North America in partnership with One Rock Capital Partners in 2021. The firm is known for making investments in numerous consumer names, including Hostess Brands, Utz and Pinnacle Foods.

Kellogg split into two in 2023, creating WK Kellogg to house cereal brands and Kellanova to house its other brands. M&M's owner Mars agreed to buy Kellanova for $36 billion last year.