Mondelez International, the parent company of Cadbury, is reportedly exploring a potential acquisition of U.S. chocolate maker Hershey, in what could lead to the formation of a global confectionery powerhouse. Bloomberg News cited sources familiar with the matter, though both companies declined to comment.
Following the news, Hershey’s shares surged 19% to $208.03, boosting its market valuation to $35 billion. In contrast, Mondelez shares fell by 4%, with the company currently valued at $84 billion. This marks Mondelez’s second attempt to acquire Hershey, after a $23 billion bid was rejected in 2016.
Key to any potential deal is the approval of the Hershey Trust Company, which holds voting control and supports the Milton Hershey School. Market conditions, such as rising cocoa prices and faltering demand due to price hikes, have put pressure on confectionery companies, spurring renewed merger interest.
A successful acquisition would expand Mondelez’s U.S. presence, enhancing its portfolio of brands like Cadbury and Milka with Hershey’s leading U.S. chocolate market share of 36%. The deal is part of a broader trend of strategic mergers in the food industry, following Mars’ recent $36 billion acquisition of Kellanova.