Hershey rejects Mondelēz takeover bid
Confectionery giant The Hershey Company has revealed it has “unanimously rejected” a takeover bid from snack conglomerate Mondelēz International.
Hershey said it received a preliminary, non-binding indication of interest from Mondelēz to acquire the company for a mix of cash and stock consideration, totalling $107 a share of its common stock. The indication of interest also included other non-monetary considerations.
However, Hershey said that after evaluating the offer, the company’s board “unanimously rejected the indication of interest and determined that it provided no basis for further discussion between Mondelēz and the company”.
It added that its board and management team are “committed to enhancing value for all stockholders in accordance with the company’s strategic plan”.
The deal would have merged brands including Hershey, Reese’s, Brookside, Cadbury, Oreo and Trident under one roof.
It would have also reinstated Mondelez as the largest confectionery player in the world by some margin, with around 18% market share, as well as the second largest packaged food manufacturer in the world, with 3% share of total sales, according to Jack Skelly, confectionery analyst at Euromonitor International.
“Overall, however, this move does make sense for both companies, given the synergies in their focus on high growth, highly profitable snacks, their drive to improve efficiencies and their geographically complementary nature,” Skelly noted. “Whilst shocking the industry, Mondelez’s move will start to make more sense from further away.”
When contacted by Confectionery Production, a spokesperson for Mondelēz said, “As a matter of practice, we don’t comment on market rumours or speculation.”