Update: Hershey's main controlling owner, The Hershey Trust, has rejected Mondelēz International's preliminary takeover offer as being too low, Bloomberg reported, citing people familiar with the matter. The trust has approximately 80% of the company's voting power, said the report.
Sweets and snacks company Mondelēz International Inc. is exploring an acquisition of chocolate maker Hershey Co. in a potential deal that would create a food giant with combined sales of almost $50 billion, people familiar with the matter told Bloomberg.
Mondelēz, which is valued at around $84 billion, has made a preliminary approach to Hershey, which has a market capitalization of about $35 billion, about a possible combination, said the people, who asked not to be identified because discussions are private.
Both Mondelēz and Hershey declined to comment.
The Hershey Trust Co., a charitable trust that has as its sole beneficiary the Milton Hershey School, maintains voting control over The Hershey Co., and its approval is key in any deal, according to a Reuters report.
This is not the first time that Mondelēz has tried buying Hershey, the news agency said. In 2016, Mondelēz abandoned the pursuit of Hershey after the latter rejected a $23 billion takeover bid.
Hershey Co., based in Hershey, Pennsylvania, has more than 90 brands in approximately 80 countries that drive more than $11.2 billion in annual revenues, including Hershey’s, Reese’s, Kisses, Kit Kat, Jolly Rancher, Twizzlers and Ice Breakers, and salty snacks including SkinnyPop, Pirate’s Booty and Dot’s Homestyle Pretzels.
With 2023 net revenues of approximately $36 billion, Deerfield, Illinois-based Mondelēz International operates in 150 countries around the world with brands such as Oreo, Ritz, LU, Clif Bar and Tate’s Bake Shop biscuits and baked snacks, as well as Cadbury Dairy Milk, Milka and Toblerone chocolate.
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