HERSHEY, Pa. — The Hershey Co. has entered into a definitive agreement to acquire Lily’s, a high-growth, better-for-you (BFY) confectionery brand. Lily’s low-sugar products include dark- and milk-chocolate style bars, baking chips, peanut-butter cups and other confection products that fit Hershey’s multipronged better-for-you snacking strategy, the acquiring company said. Lily's will add a key better-for-you confection brand to Hershey’s portfolio of chocolate and candy.
“Hershey is focused on developing a BFY confection portfolio that offers a variety of choices to meet the evolving needs of our consumers," said Chuck Raup, president U.S. for Hershey Co. “Lily’s is a great strategic complement to our existing offerings in this growing segment of the confection category.”
BFY snacking continues to grow faster than mainstream segments across snacking categories such as potato chips, ice cream and cookies, Hershey said. BFY offerings, however, are still under-developed in confection, and the Lily's acquisition would enable Hershey to accelerate this growth and reimagine the future of the candy aisle in partnership with retailers, the candymaker said.
Based now in Boulder, Colo., Lily’s traces its roots to co-founder Cynthia Tice’s decision to raise awareness about better-for-you foods by opening Center Foods, a natural foods store, in Philadelphia in 1978. In 2012, Cynthia launched four Lily’s chocolate-style bars nationally in Whole Foods Market, and the expanded line of bars, baking chips and other confections can be found at retailers nationwide. The brand’s mission is to offer consumers a range of great tasting, low sugar treats, it said.
“Cynthia had the vision that consumers wanted a better-for-you option in confections, and today 80% of adults want to cut back on their sugar intake,” said Jane Miller, CEO of Lily’s. “By joining the Hershey’s family of brands, Lily’s will become a platform confection brand making BFY options easily accessible to all consumers.”
The acquisition will be financed with cash on hand as well as short-term borrowings. Lily’s acquisition is expected to be slightly accretive to earnings in the first full year, post closing. The acquisition is subject to customary regulatory approvals and is expected to close in the next few months.
The Hershey Co., Hershey, Pa., has more than 80 brands around the world that drive $8 billion in annual revenues, including Hershey’s, Reese’s, Kit Kat, Jolly Rancher, Ice Breakers, SkinnyPop and Pirate’s Booty.