Mondelez International eyes US chocolate maker Hershey in potential $50 billion deal

Mondelez International Inc., the global snack and sweet treats company, is in the early stages of exploring a potential acquisition of Hershey Co., according to sources familiar with the matter in a news report.

The move would create a food powerhouse with a combined revenue of nearly $50 billion, consolidating Mondelez's diverse portfolio with Hershey's iconic chocolate and candy brands.

The Chicago-based company, valued at around $84 billion, has made an initial approach regarding a merger with Hershey, which is currently valued at approximately $35 billion.

This marks the second time Mondelez has expressed interest in acquiring Hershey; in 2016, it walked away from a $23 billion bid after Hershey rejected the offer.

At present, Hershey Co. is trading with a market value of about $40 billion, including debt, positioning a potential acquisition as one of the biggest deals of the year. For context, Mars Inc.’s acquisition of snack maker Kellanova for $36 billion earlier this year currently holds the title for the largest food sector deal of 2024.

While discussions are still in the early stages, and no final deal is guaranteed, the ongoing deliberations reflect broader trends within the food industry.

Mondelez, known for products like Oreo cookies, Ritz crackers, and Toblerone chocolates, is keen on expanding its footprint in the chocolate, biscuits, and baked snacks markets.

Analysts suggest that Mondelez is open to acquisitions, given its capacity to handle debt. In contrast, Hershey, while enduring higher cocoa and sugar costs, has faced challenges in the current economic climate, leading to recent revisions in its financial outlook.