Hershey's board has unanimously rejected Mondelez's takeover offer
(Jemal Countess/Getty Images)
Snack-food giant Mondelez made an offer to acquire Hershey.
And Hershey said thanks, but no thanks.
On Thursday morning, The Wall Street Journal first reported that Mondelez had made an offer to acquire the candymaker.
Shares of Hershey jumped as much as 21% after the report, to north of $117 per share.
A follow-up report from CNBC, citing unnamed sources, said that Mondelez had bid $107 per share for Hershey with the deal half in stock and half in cash. That report sent shares of Hershey off their best levels of the morning, to around $113.
In a statement released on Thursday afternoon, the board of Hershey confirmed it received an offer from Mondelez valuing the company at $107 per share, but said it "unanimously rejected the indication of interest and determined that it provided no basis for further discussion between Mondelez and the Company."
Hershey has a market cap of about $25 billion; Mondelez has a market cap of about $68 billion. Mondelez was spun out of the unit of Kraft Foods in 2012.
CNBC's David Faber added that talks between the company had been going on for a few months. According to the WSJ, Mondelez had pledged to protect jobs in the event of a merger, locate its headquarters in Hershey, Pennsylvania, and rename the company Hershey.
But the Hershey statement makes clear that there seems, at this time, to be no real interest from the company, which has about 80% of its voting shares controlled by the Hershey Trust.
Activist investor Nelson Peltz and Bill Ackman's Pershing Square both hold sizeable stakes in Mondelez. Ackman first took a $5.5 billion stake in Mondelez in August 2015, but has since sold down his share in the snack-maker, unloading about 20 million shares in March.
Mondelez has long been a target of activist investors, with Peltz publicly agitating in 2013 for Pepsi to acquire Mondelez in a more than $65 billion deal.
Following this report, shares of other food companies rose, including Kellogg (+4%), Campbell Soup (+3.6%), Hain Celestial (+2.1%), General Mills (+4.2%), and PepsiCo (+2%).
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