Mondelez won’t pursue Hershey

Roger DuPuis//August 29, 2016

Mondelez won’t pursue Hershey

Roger DuPuis//August 29, 2016

Illinois-based Mondelez International, maker of the popular chocolate cookies and a wide range of other snack foods, today announced that it is no longer pursuing a combination with The Hershey Co.

“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,” Mondelez Chairman and CEO Irene Rosenfeld said. 

Hershey’s board on June 30 rejected a $23 billion purchase proposal from Mondelez, and the Dauphin County candy company has never said anything further about the pitch.

Mondelez also has been tight-lipped, until today.

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

Last month, Hershey’s most recent earnings statement revealed that the company had recorded its first quarterly sales increase in a year, and Hershey declared quarterly dividends.

Mondelez, meanwhile, in July recorded its 11th straight quarterly decline, CNBC reported, and analysts suggested Mondelez itself could be an acquisition target

The company did make one Hershey-related acquisition, however. Mondelez this month announced that it had reached an agreement to buy the license to manufacture and sell Cadbury-branded biscuits internationally, including in North America. Hershey — which backed away from an effort to buy UK-based Cadbury six years ago — has held the rights to Cadbury’s U.S. chocolate brands since 1988. The biscuits, however, have been produced under a separate license.

But hopes for any merger between Mondelez and Hershey seemed to die this afternoon with Rosenfeld’s statement.

“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,” she said.