Hershey reportedly mulling $17 billion solo bid for Cadbury
21 Nov 2009
US-based confectioner Hershey, run by the tight knit Hershey family's Hershey Charitable Trust, is planning to take on the Goliath food company Kraft by launching a solo bid of $17 billion for Cadbury PLC, according to reports.
Even as the landscape for the takeover battle of the British maker of Dairy Milk chocolate, Cadbury widened this week with Hershey and Ferrero International SA saying that they were considering a possible offer for Cadbury, (See: Hershey, Ferrero to rival Kraft's bid for Cadbury) the Pennsylvania-based confectioner is being pushed by the charitable trust to make a bid that would better its bigger rival Kraft's f $16.7-billion unsolicited takeover offer.
The Wall Street Journal, citing people familiar with the matter, reported today that the Hershey Charitable Trust, which controls 77 per cent of the company's voting stock and 31 per cent of common stock, is pushing Hershey's chief executive, David West, to make a rival offer to Kraft's $16.5 billion bid made earlier this month for Cadbury, which was rejected by the British maker of Dairy Milk chocolate board. (See: Kraft's low growth business model unappealing: Cadbury)
This week, Hershey and Italian chocolatier Ferrero had said in separate statements that they were reviewing a possible bid, but gave no assurance that they would make an offer for Cadbury.
Both companies were forced to respond after Britain's Panel on Takeovers and Mergers asked them to clarify media reports, which had said that they were considering a joint bid for Cadbury.
Although, West has held talks with Ferrero on two occasions, nothing seems to have materialized since both companies are planning to make solo bids.
