Mondelēz Takes Majority Stake in Undercover Snacks to Expand in Better-for-You “Permissible Indulgence” Snacking

Mondelēz International is taking a majority stake in Undercover Snacks, the New Jersey maker of gluten-free chocolate quinoa crisps. The deal pushes the Oreo and Cadbury owner further into what it calls “permissible indulgence”, a snacking segment it sees growing faster than its core cookie and chocolate business. Mondelēz disclosed the investment alongside its third-quarter results on 29 October, and Undercover announced the details on 30 October.

Financial terms were not disclosed. The parties expect the transaction to close in early 2027, subject to customary conditions. Centerview Partners acted as Undercover’s financial adviser and Goodwin Procter as its legal counsel.

A founder-led brand built on quinoa crisping

Undercover is based in East Hanover, New Jersey. Diana Levy founded the brand after two of her three daughters were diagnosed with celiac disease. Its core range covers chocolate-covered and frosted quinoa crisps, which the company positions as gluten-free, non-GMO snacks made in a peanut- and tree-nut-free facility powered by solar energy and using Rainforest Alliance-certified cocoa.

The products are now sold in more than 25,000 retail locations. The brand has also had large-scale sampling exposure in the air: United Airlines has handed out more than 175 million units on its flights since 2023. Undercover has brought part of its supply chain in-house as well. According to Baking Business, it runs its own quinoa crisping operation, Undercover Ingredients, which launched in February 2025. That gives it control over a key input that most small snack brands buy from co-manufacturers.

Standalone inside Mondelēz North America Ventures

Mondelēz will run Undercover as a standalone business within its Mondelēz North America Ventures unit, next to Perfect Snacks, Tate’s Bake Shop and Hu. Diana Levy will stay on as chief executive, and Michael Levy will continue as president and chief operating officer. The Levy family will keep a significant minority stake, and both will sit on the company’s board.

The minority-retention structure has become a familiar model for large CPG groups buying founder-led brands. Keeping founders invested and in charge is meant to protect the brand’s identity while the acquirer brings distribution, procurement and retail sales muscle.

Why Mondelēz wants “permissible indulgence”

Chairman and CEO Dirk Van de Put described Undercover as a “better-for-you and permissible indulgence snacking leader” and said the business is “highly incremental to our existing portfolio, expanding our presence in the fast-growing permissible indulgence segment.”

He was more direct about the strategic logic on the results call. “We believe that over time our portfolio needs to evolve towards healthier snacks,” Van de Put said, according to Bloomberg Law, adding that the deal was “one step in that direction.”

Just Food framed the acquisition as part of a healthier agenda at Mondelēz. The company is reshaping a portfolio dominated by chocolate, biscuits and baked snacks while consumer interest in better-for-you options keeps growing.

Big Food keeps buying better-for-you snacks

The Undercover deal adds to a string of large-company moves into smaller, health-positioned snack and convenience brands. Barilla closed its roughly US$750 million acquisition of mac-and-cheese brand Goodles the week before. Hershey, which owns better-for-you snack brand LesserEvil, has said demand for its salty snacks is outrunning supply and that automation and new lines are coming in the first half of 2027, according to Food Dive.

For incumbents, buying established challenger brands is often faster than reformulating legacy products or building new brands internally. These brands come with their own consumer loyalty, retail velocity data and, as with Undercover, sometimes proprietary processing capability. For founders and investors in the segment, a run of deals like this suggests strategic buyers are still active even as the wider M&A market stays selective.

What to watch

• Distribution: how quickly Mondelēz extends Undercover beyond its current 25,000-plus doors, particularly in convenience, club and international channels.
• Capacity: whether the Undercover Ingredients crisping operation is scaled up or supported with Mondelēz manufacturing assets.
• Portfolio fit: potential cross-category innovation with Hu’s premium chocolate and Perfect Snacks’ refrigerated protein bars.
• Further deals: whether Mondelēz and its peers keep adding small better-for-you brands as they rebalance away from traditional indulgent categories.