Kellogg is selling Keebler cookies and other brands for US$1.3 billion, about $2.6 billion less than it spent on that brand alone 17 years ago.
Food producers are trying to find new brands with more growth potential after sweeping shifts in consumer taste, particularly in the U.S.
The value of household names like Keebler has deteriorated as families seek food and snack alternatives that are at least perceived to be healthier.
Along with Keebler, the Battle Creek, Michigan, company said Monday that it would sell Mother's and Famous Amos cookie brands, as well as its fruit-flavoured snack, pie crust and ice cream cone businesses, to the Italian sweets maker Ferrero.
The brands generated sales of $900 million and profits of $75 million last year, according to Kellogg.
Kellogg acquired Keebler Foods, founded in 1853, in 2001 for $3.86 billion.
Ferrero is best known for the brand Nutella hazelnut cream. The company said Monday that it would also acquire six U.S. manufacturing plants from Kellogg. A year ago Ferrero paid Nestlé $2.8 billion for its chocolate and candy brands, including SweeTarts, Nerds, Butterfinger and Crunch.
The Kellogg-Ferrero deal is expected to close by the end of July.