Hershey Co. reportedly being courted in potential takeover bid | Penn Live Patriot News

The Sweetest Takeover Drama: Hershey Meets Mondelez (Again)

Hold onto your candy bars, folks! Hershey Co., the iconic chocolate maker from Derry Township, might be back on the market. Mondelez International, the snack behemoth behind Oreos and Ritz crackers, is reportedly eyeing a potential takeover. According to Bloomberg, this isn’t the first time Mondelez has sweetened up to Hershey; their previous $23-billion bid in 2016 didn’t make the cut. Now, discussions are heating up again, but it’s still too early to tell if this will turn into a mega deal.

If this union happens, it could create a $50-billion snack powerhouse, rivaling this year’s other blockbuster food industry deal: Mars Inc.’s acquisition of Kellanova for $36 billion. Hershey’s stock even got a sugar rush, soaring 19% in its biggest intraday gain in over eight years. But any takeover would need the blessing of the Hershey Trust, a powerhouse organization that has held control since 1905. Beyond chocolate, the Trust uses its profits to support the Milton Hershey School, helping children from low-income families.

What’s the holdup? Hershey’s unique dual-class stock structure, community ties, and Pennsylvania laws make it a tough nut to crack. The Pennsylvania Attorney General’s Office has veto power if a sale doesn’t make financial sense, and past attempts, like bids from Wm. Wrigley Jr. Co. and Nestle have all melted under pressure. Even rumors about this deal come with a grain of salt—an “uncooked” alert from Betaville suggests it’s still speculative at best.

Interestingly, Hershey has been facing some headwinds lately. Higher cocoa prices and weak consumer spending have impacted profits, with third-quarter earnings falling short of expectations. Meanwhile, Mondelez seems hungry to expand its snacks empire. Whether this deal goes through or not, one thing is clear: the business of sweets is anything but simple………[read more]

Rising Dough

How do companies like Hershey balance staying true to their local roots and community values while navigating pressure from global investors and competitors to merge or sell?