Mondelez moves on from Hershey

by Monica Watrous
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Mondelez moves on from Hershey
Hershey’s board of directors unanimously rejected the expressions of interest from Mondelez.

DEERFIELD, ILL. — Mondelez International, Inc. announced on Aug. 29 it has ended discussions with the Hershey Co. regarding a potential merger. Moving forward, the maker of Oreo cookies and Ritz crackers said it will continue to execute its plans to deliver sustainable growth and shareholder value.

Irene Rosenfeld, Mondelez
Irene Rosenfeld, chairman and c.e.o. of Mondelez

“As the world’s leading snacking company, we remain focused on successfully executing our strategy to deliver both sustainable top-line growth and significant margin expansion and are well-positioned to continue to deliver value to our shareholders,” said Irene Rosenfeld, chairman and chief executive officer of Mondelez International. “Our proposal to acquire Hershey reflected our conviction that combining our two iconic American companies would create an industry leader with global scale in snacking and confectionery and a strong portfolio of complementary brands.

“Following additional discussions, and taking into account recent shareholder developments at Hershey, we determined that there is no actionable path forward toward an agreement.”

Mondelez first approached Hershey with a takeover bid in June, offering the Hershey, Pa., chocolate company $107 a share in a transaction valued at more than $25 billion, including the assumption of debt.

After receiving input from the company management and outside financial and legal advisers, Hershey’s board of directors unanimously rejected the expressions of interest “and determined that it provided no basis for further discussion between Mondelez and the company.”

“The company’s board of directors and management team are committed to enhancing value for all stockholders in accordance with the company’s strategic plan,” Hershey said at the time of the offer.

The deal hinged largely on the Hershey Trust, which controls 80% of the company’s stock and has opposed selling the company in the past.

“While we are disappointed in this outcome, we remain disciplined in our approach to creating value, including through acquisitions, and confident that our advantaged platform positions us well for top-tier performance over the long term,” Ms. Rosenfeld said.

Shares of the Hershey Co. tumbled more than 11% in after-hours trading Aug. 29 in response to news Mondelez had moved on from pursuing a deal. 
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