US: Mondelez Ends Pursuit Of Hershey

Mondelēz International has pulled the plug on its takeover plans for Hershey after its initial $23bn offer made back in June was rejected.

Having rejected the $107 per share approach, reports suggested that Hershey would not be willing to enter into deal negotiations for an offer of less than $125 per share. Mondelēz’s Chief Executive Irene Rosenfeld is said to have approached Hershey Chief Executive John Bilbrey again last week, indicating that it would only be willing to offer up to $115 per share.

The deal would have created the world’s biggest maker of confectionary but in a statement issued yesterday Mondelēz announced that it had now ended discussions with Hershey regarding a possible combination of the two companies.

Rosenfeld said: “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. 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.”

NAM Implications:
  • The issue is whether Hershey is now in play for other takers…
  • Little harm in conducting some what-ifs.
  • …but proactive players are already back to business as usual…