ROSSLYN, Va. -- The Hershey Co. has joined The Ferrero Group for a chance to acquire Nestle's U.S. confectionery business. Both candy manufacturers submitted bids for the iconic chocolate manufacturer behind brands such as Butterfinger, Baby Ruth, Raisinets, Crunch, Sno-Caps, Laffy Taffy and others. Nestle's U.S. chocolate arm is worth $2 billion to $2.5 billion, according to a report on CNBC.
The report indicates Ferrero, Alba, Italy, could be the current front-runner as it is more willing to be aggressive on price. Any decision on the winning bid is likely still a week or so out, and several private-equity firms have also indicated an interest. Speculation around possible acquirers has included Ferrero, Mondelez, Pladis and Leaf Brands.
The bids were made following an announcement by Nestle in June that it would explore strategic options, including a sale, for its U.S. chocolate business, which has annual sales of $924 million and 11.5% market share. Nestle U.S. is based in Rosslyn, Va.
Hershey, Hershey, Pa., recently made news when it announced its acquisition of snack manufacturer Amplify Snack Brands, maker of SkinnyPop. The Hershey Co. currently holds 43.9% of the U.S. chocolate market for the 52 weeks ending 10/8/17, according to Hershey and IRI.
Ferrero has also been actively acquiring. Last year it paid approximately $1 billion to purchase Ferrara Candy Co. The deal was made on the heels of another confectionery purchase: Fannie May Confections in May 2017.