Millionaire Merger Proposal: Desire for KitKat's Creator by the Manufacturer of Milka
It appears that another massive merger is on the horizon in the confectionery sector. According to reports, American conglomerate Mondelez is considering acquiring its rival Hershey, with insiders sourcing the information to Bloomberg. Neither company has yet to provide a comment on the matter.
Hershey's shares saw a significant surge on Wall Street, reaching as high as 19%, which is the highest level in eight and a half years. This surge valued Hershey, the creators of KitKat, at around $40 billion in the stock market. In contrast, Hershey's competitor, whose market capitalization is roughly double, saw a four-percent drop in its share price.
A potential merger between these two prominent confectionery companies could result in the union of two household names, both of which also produce everyday groceries. Mondelez's portfolio includes Oreo, Cadbury, Chips Ahoy, and Ritz Crackers, while Hershey's offerings include KitKat, Hershey's chocolate, Reese's, Jolly Rancher, and SkinnyPop Popcorn.
Mondelez had previously attempted to acquire Hershey for a staggering $23 billion back in 2016. However, any such offers must be approved by the Hershey Trust, the trust company that holds the majority of votes in the sweet giant. So far, the Hershey Trust has been resistant to selling off the iconic company.
The confectionery industry is currently facing escalating costs and decreasing consumer demand, leading to increased consolidation pressure. Just this summer, the maker of Snickers, Mars, announced its acquisition of the Pringles manufacturer, Kellogg's, for an impressive $36 billion.
The rumors of Mondelez acquiring Hershey have caused a stir in the market, potentially impacting the demand for Other candy products from both companies. If the merger goes through, the merged entity could offer a wide range of beloved treats, such as Oreo, Cadbury, Hershey's chocolate, and Reese's, among others.
