Moneybox

Hershey Just Refused to Let the Owner of Cadbury Drink Its Milkshake

Too sweet to sell.

Photo Illustration by Scott Olson/Getty Images

The owner of Oreo, Cadbury, Toblerone, and Sour Patch Kids tried this month to take over the Hershey Co.—and it’s now officially been rejected, the Chicago Tribune reports. Had it succeeded, Mondelez International Inc.’s $23 billion bid to buy the iconic sweets manufacturer would have made it the world’s largest candymaker. Instead, Hershey’s board of directors apparently found the deal about as unpalatable as a handful of Good & Plenty’s, voting unanimously to pass on it.

It didn’t matter, then, that Hershey’s stock price has been flat for nearly three years, and demand for sugary products has been on the decline. Nor did it matter that the company isn’t experiencing much growth; Hershey’s core offerings remain iconic American products, and its net income has been pretty consistent over the past few years. Nor was Hershey swayed by the Illinois-based Mondelez’s offer to move to Hershey’s eponymous Pennsylvania hometown and rename itself, well, Hershey. (Nor is this the first time Hershey has rejected a suitor. Nestle, for instance, was rumored in 2002 to have had interest in buying the company.)

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So, for now, consumers have no need to worry about a newly massive candy conglomerate—although even if the buyout had gone through, there probably would have been nothing to fear. The food industry has been consolidating at a rapid pace recently, but snack food in particular relies on its low prices. Snack-food production has relatively low barriers to entry, at least on the small scale, so if a giant candy monopoly tried to raise prices, more entrants could flood the market and push prices back down. It’s no shocker that Mondelez had a big craving for Hershey. Reese’s fanatics, though, probably never had a reason to worry.

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