Hershey’s main owner, the Hershey Trust Company, has rejected a preliminary takeover offer from Mondelez International due to its perceived low value. The decision comes after Bloomberg reported that Mondelez was exploring an acquisition of the chocolate maker.
Mondelez had offered $15 billion for Hershey in a bid to create one of the world’s largest confectioners. However, the trust has deemed the offer “too low” and has declined it.
The Hershey Trust Company’s approval is crucial in any takeover deal, given its significant voting control over the company. This makes the rejection a significant blow to Mondelez’s plans.
Mondelez had also announced a share buyback program of up to $9 billion earlier in the day, which could be seen as an attempt to reassure investors about the company’s intentions.
The Hershey Trust Company was previously involved in negotiations with Mondelez in 2016, when the Oreo maker made a $23 billion offer that was ultimately rejected. The trust has since stated that it will only consider offers of at least $125 per share.
As a result of the rejection, Hershey’s shares fell by 3.3% on Wednesday, while Mondelez’s shares rose 3.5%.
Source: https://www.reuters.com/markets/deals/hersheys-main-owner-rejects-mondelezs-offer-too-low-bloomberg-news-reports-2024-12-11