Mondelez International (MDLZ) Drops Plan To Buy Hershey
Zacks Investment Research | Aug 29, 2016 10:31PM ET
Mondelez International, Inc. (NASDAQ:MDLZ) recently confirmed that it is no more pursuing the possible merger with The Hershey Company (NYSE:HSY) . Following the announcement, shares of Hershey declined 11.70% in after-hours trading on Monday while that of Mondelez rose 3.81%.
In June, Mondelez offered to acquire Hershey for about $22.8 billion worth of cash and stocks. Mondelez had offered to pay $107 a share, half in cash and half in stock. Mondelez had expected that the merger of the two food giants would create a global leader in snacking, confectionary and complementary brands. However, Hershey’s board of directors unanimously rejected the offer in June.
Mondelez eventually reached the decision after several discussions, taking into account the recent changes in shareholders at Hershey. Reportedly, The Hershey Trust, the company’s largest shareholder, was reluctant about the sale. Moreover, significant changes in management of the Hershey Trust are underway and are expected to take time to complete.
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