The sale of Hershey Foods is proving to be sticky business. Since announcing it was placing the company on the auction block last month, The Milton Hershey School-which owns 77 percent of the confectionery giant-has faced a firestorm of resistance from workers and the Hershey, PA, community. That prompted Pennsylvania Attorney General Mike Fisher (a candidate for governor) to file a motion to block the sale. The Dauphin County Orphans Court will heard the case yesterday in Harrisburg, PA, which oversees legal proceedings regarding trusts.
Nestlé spokesperson Marcel Rubin told Reuters that regardless of the ruling, the court case “is certainly not the final step.” Still, opposition isn’t coming just from Hershey: Analysts have criticized the $11.5 billion bid Nestlé has reportedly made for Hershey, saying such a price would seriously harm Nestlé’s credit rating. Nestlé’s shares dropped 10 percent, then bounced back after ceo Peter Brabeck insisted the company wouldn’t spend more than $12 billion on Hershey. Either way, the acquisition would most likely surpass Nestlé’s $10 billion purchase of Ralston Purina last year.
There are likely to be more twists and turns down the road. Now reports are circulating that Nestlé and rival Cadbury-Schweppes are in discussions about sharing the brands of Hershey Foods. Kraft Foods, Glenview, IL, is also said to be considering a bid.
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