Hershey to Make Acquisitions Priority for Use of Cash, CEO Says
Hershey Co. (HSY) Chief Executive Officer John P. Bilbrey said acquisitions will be the priority for the chocolate maker’s cash as the company looks to take confectionery-market share in North America and expand abroad.
The company sees $10 billion in potential local and regional acquisitions across the globe, Chief Growth Officer Michele Buck said today during an investor meeting in New York that was webcast. Including other categories such as sweet snacks, acquisition opportunities total as much as $30 billion, Buck said.
Hershey is seeking to surpass Mars Inc. to become the largest confectionery company in North America. The 2008 purchase of Wm. Wrigley Jr. Co. by Mars created the world’s biggest candy maker. Hershey is targeting China to be its second-largest market, after the U.S., within five years as it strives to boost revenue to $10 billion. Last year, Hershey had sales of $6.1 billion. The company also sees significant opportunity in India.
The Hershey, Pennsylvania-based chocolate maker passed on a chance to buy Cadbury Plc in 2010. Kraft Foods Inc. (KFT) purchased Cadbury that year. Hershey had $567.3 million in cash and equivalents on April 1, according to data compiled by Bloomberg.
Hershey fell 0.5 percent to $69.18 at 11:01 a.m. in New York. The shares had risen 12 percent this year through June 22.
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