The Telegraph
Since 1st March, 1999
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Nestle bids $ 11.5 bn for Hershey Foods
- Senior executives visit US candymaker’s factories twice

Washington, Aug. 26 (Agencies): Swiss food giant Nestle SA is offering about $ 11.5 billion to acquire US rival Hershey Foods Corp, USA Today reported on Monday.

Citing sources familiar with the offer, the newspaper said Nestle presented a preliminary bid of $ 82 to $ 85 a share, after senior executives toured Hershey factories twice last week and reviewed the candymaker’s financial data.

Nestle, however, declined to comment on reports that it has offered around $ 11.5 billion to buy Hershey Foods.

“Nestle does not comment on market fantasies,” said spokesman Francois-Xavier Perroud, based in Vevey in Switzerland.

Sources close to the situation confirmed that Nestle, along with several other companies had toured the Hershey manufacturing facilities and started reviewing the companies financial records in recent weeks.

However, these sources said any bid for Hershey at this point is preliminary and negotiations could fall apart at any time.

Nestle, Cadbury Schweppes and Kraft Foods have expressed serious interest in bidding for Hershey, so far, sources said.

The Hershey Trust Company last month announced that it had ordered Hershey Foods executives to seek bids on its controlling stake in the candymaker.

The trust, which owns 77 per cent of the voting shares, said it was looking to diversify its assets to protect its investment.

About half of the Trust’s assets are invested in the candymaker’s stock and board members say the trust—which benefits the 93-year-old Milton Hershey School for Disadvantaged Children—could be hurt if the company’s finances falter.

Hershey Foods stock, which traded at $ 62.50 per share just before news of a possible sale emerged last month, closed on Friday at $ 75.03, up 24 cents, on the New York Stock Exchange.

In early trading in Zurich, Nestle shares were down 1.7 per cent at 325 Swiss francs ($ 214).

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