The saga ends
Hershey Foods ended its controversial search for a buyer on Tuesday
after it rejected all bids for the confectionery manufacturer.
Hershey Foods ended its controversial search for a buyer on Tuesday after its controlling shareholder said it rejected all bids for the famed confectionery manufacturer, which had been expected to fetch up to $12 billion (€12.3bn).
The Hershey Trust company, which controls 77 per cent of the shareholder voting rights in Hershey Foods, said it had asked company executives to end their search for a buyer.
"The trust board has rejected all the bids that have been received," Trust company spokesman Rick Kelly told reporters. "It is asking the company to end the process of exploring a sale."
The announcement came late on Tuesday after a 10-hour trust board meeting in the Philadelphia suburb of Valley Forge, and nearly two months after the trust first revealed a proposal to sell the 108-year-old maker of Hershey's, Reese's and Jolly Rancher brand candies.
The decision was a victory for opponents of the deal including Pennsylvania Attorney General Mike Fisher and residents of central Pennsylvania, who feared a sale would mean plant closures and job losses in the vicinity of the company's hometown, Hershey.
Hershey Foods confirmed early on Wednesday that the board had instructed it to cease the sale process.
Kelly declined to give details on how the 17-member trust board voted, but said trust officials would speak to reporters again later today.
He said the board had received offers for the company and "after analysing them the board rejected the bids."
Wall Street analysts had said Hershey Foods could fetch up to $12 billion from a rival food company such as Nestle, Cadbury Schweppes, or Kraft Foods.
The sale plan was seen as a way to diversify trust assets but was opposed by Fisher, who asked the trust to consider alternatives to a sale.
He later won a court injunction blocking any transaction until a judge could determine whether a final deal required court approval. The trust appealed the injunction, which remains in place, but a higher court has yet to rule. And so the Hershey saga ends…for the moment.
