Preview Newsletter
Hershey Media Report 9/7/16
-
Spurned by Hershey, Mondelez Pushes Into U.S. Chocolate Market (video)
Sep 7, 2016 | Bloomberg
By Craig Giammona
Mondelez International Inc. wanted Hershey Kisses and Reese’s Pieces. The global snack giant will have to settle for Oreo candy bars instead. After abandoning a bid last month to acquire Hershey Co., Mondelez is making its own play for U.S. chocolate consumers. The Deerfield, Illinois-based company will roll out Oreo-branded candy bars -- already available in some countries overseas -- in an attempt to crack a domestic market where it has little presence. -
Mondelez (MDLZ) Stock Receives 'Overweight' Rating at JPMorgan
Sep 6, 2016 | The Street
By Kaya Yurieff
Mondelez Int'l (MDLZ) stock coverage was reinstated with an "overweight" rating and $50 price target at JPMorgan on Tuesday morning following a period of restriction. Last week, the Deerfield, IL-based snack company said it was no longer pursuing a takeover of Hershey (HSY). -
Mondelez International (NASDAQ:MDLZ) expanding into U.S. chocolate market with Milka Oreo’s: Barrick Gold Corporation (NYSE:ABX), The Kroger Co. (NYSE:KR), Goldcorp Inc. (NYSE:GG)
Sep 6, 2016 | Benchmark Monitor
Brief mention of the rejected bid from Mondelez. Relevant portion pasted below. -
Hershey Company (The) (HSY) Shares are Down -10.44%
Sep 6, 2016 | Consumnes Connection
By Zachary Reyes
Brief mention of the rejected bid from Mondelez. Relevant portion pasted below. -
On Investments: Profit margins can offer hint that a stock is strong
Sep 7, 2016 | Omaha World Herald
By John Dorfman
Brief mention of the rejected bid from Mondelez. Relevant portion pasted below.
National Coverage
Trade Coverage
Full Text of Stories Below
Local Coverage
-
Spurned by Hershey, Mondelez Pushes Into U.S. Chocolate Market (video)
Sep 7, 2016 | Bloomberg
By Craig Giammona
Mondelez International Inc. wanted Hershey Kisses and Reese’s Pieces. The global snack giant will have to settle for Oreo candy bars instead.
After abandoning a bid last month to acquire Hershey Co., Mondelez is making its own play for U.S. chocolate consumers. The Deerfield, Illinois-based company will roll out Oreo-branded candy bars -- already available in some countries overseas -- in an attempt to crack a domestic market where it has little presence.
he Oreo candy bars, made with Milka-branded chocolate, will start to hit U.S. stores in October and will be available nationally in 2017, according to the company. As part of the American chocolate push, Mondelez also will put its premium Green & Black’s brand in more U.S. stores. The company is creating a new line of products under the brand that will be made without artificial ingredients and genetically modified organisms.
Mondelez, which owns the Cadbury brand overseas, is the second-largest seller of chocolate in the world. But its U.S. candy business remains small -- a weak spot that the Hershey acquisition was meant to address. With the two sides failing to agree on a deal, Mondelez is hoping its best-selling cookie brand can become a Hershey rival.
“Nowhere is Oreo stronger than in the U.S.,” Tim Cofer, the company’s chief growth officer, said in an interview. “We think this will drive the mainstream chocolate category in the U.S.”Cookie Bits
The Oreo candy bars, currently distributed in about 20 countries worldwide, are made with creme filling and bits of the namesake cookies, covered in Milka chocolate. There is also a version that features an Oreo cookie in the center of the chocolate bar, with creme on either side. Though Mondelez has planned to sell Oreo candy bars in the U.S. for months, the Hershey misfire may have added urgency to the push.
Sluggish economic conditions in key international markets also are putting pressure on Mondelez to seek growth in its home country. The company was split off from Kraft Foods in 2012 to focus on offshore opportunities, and it still generates more than 70 percent of its revenue outside North America. But currency fluctuations and weaker growth in emerging markets have made the U.S. look more attractive.No Deal
Mondelez spent at least two months trying to coax Hershey into accepting a merger, which would have created the world’s largest candy company. The transaction also would have unified the Cadbury brand, which Hershey licenses in the U.S.
Hershey rejected an initial $23 billion bid in June, and negotiations never recovered. Though Mondelez offered to raise its price to $115 a share, Hershey wanted at least $125, a person familiar with the discussions said. Turmoil at the Hershey Trust Co., a nonprofit organization that controls the company, also hampered a potential deal.
That led Mondelez Chief Executive Officer Irene Rosenfeld to walk away from the talks. Still, the company remained determined to go after what Cofer calls a “geographic white space.”
Mondelez generated about $50 million in net revenue from its U.S. chocolate business last year, with most of that coming from the Toblerone brand. It’s a much different story for the company abroad: Mondelez posted worldwide chocolate sales of approximately $12.9 billion last year, according to Euromonitor International.
But the U.S. chocolate market isn’t an easy target. Many consumers are looking to cut down on sugar, weighing on the industry’s sales. Sluggish demand prompted to Hershey to expand into beef jerky with its Krave Pure Foods acquisition last year. The deal gave Hershey a bigger presence in high-protein snacks, which have posted strong growth in recent years.
Mondelez, however, isn’t deterred by chocolate’s slowdown, Cofer said.
“There will always be room for pleasure and indulgence, and chocolate fills that quite nicely,” he said. “It’s a huge category.”
View video here: http://www.bloomberg.com/news/articles/2016-09-07/spurned-by-hershey-mondelez-pushes-into-u-s-chocolate-market
-
Mondelez (MDLZ) Stock Receives 'Overweight' Rating at JPMorgan
Sep 6, 2016 | The Street
By Kaya Yurieff
Mondelez Int'l (MDLZ) stock coverage was reinstated with an "overweight" rating and $50 price target at JPMorgan on Tuesday morning following a period of restriction.
Last week, the Deerfield, IL-based snack company said it was no longer pursuing a takeover of Hershey (HSY).
"In our initial note following the news of the MDLZ/HSY deal - before going on restriction - we said that we thought 'this move [for MDLZ] is somewhat defensive in nature' against a potential approach from Kraft Heinz (KHC). It was our view that the size of the possible MDLZ/HSY deal might deter possible consolidators," the firm wrote in a note.
But with Mondelez now "left to its own devices," JPMorgan believes theoretically it may be more attractive now to Kraft Heinz from a consolidation perspective.
"Historically, 3G-led companies, when looking at potential targets, have favored larger companies with geographic diversification. Mondelez would fit that bill better than most U.S.-oriented food companies, in our view, though we of course could not rule out other potential candidates, such as General Mills (GIS), Kellogg (K),Campbell Soup (CPB), etc.," the firm added.
JPMorgan noted that Mondelez and Kraft Heinz have not discussed interest in a possible deal.
Additionally, the firm said Mondelez's cost savings plan is running ahead of its plan year-to-date with an improving cash story and the activists involved in the stock seem aware of what is likely to maximize shareholder value.
But market challenges in snacking habits, such as healthier eating, are continuing to pressure revenue, while management's focus on restoring top-line growth could limit upside to margins, JPMorgan added.
Shares of Mondelez were edging lower in late-morning trading on Tuesday.
Separately, TheStreet Ratings Team has a "Buy" rating with a score of B on Mondelez stock.
-
Sep 6, 2016 | Benchmark Monitor
Mondelez International, Inc. (NASDAQ:MDLZ) wanted Hershey Kisses and Reese’s Pieces. The global snack giant will have to settle for Oreo candy bars instead. After abandoning a bid last month to acquire Hershey Co., Mondelez is making its own play for U.S. chocolate consumers. The Deerfield, Illinois-based company will roll out Oreo-branded candy bars — already available in some countries overseas — in an attempt to crack a domestic market where it has little presence.
-
Hershey Company (The) (HSY) Shares are Down -10.44%
Sep 6, 2016 | Consumnes Connection
By Zachary Reyes
Mondelez International Inc.is walking away from takeover discussions with The Hershey Company (NYSE:HSY) two months after its $23 billion bid was rejected by the chocolate maker. The Companys principal confectionery offerings include chocolate and sugar confectionery products; pantry items, such as baking ingredients, toppings and beverages; snack items, such as spreads, and gum and mint refreshment products.
-
On Investments: Profit margins can offer hint that a stock is strong
Sep 7, 2016 | Omaha World Herald
By John Dorfman
Mondelez International Inc. (MDLZ), formerly known as Kraft Foods, spun off many of Kraft’s operations in 2012. What remains is a powerhouse in candy, snack foods and beverages. Brands include Nabisco, Cadbury and Oreo. Sales run about $26 billion a year.
Since the spinoff, Mondelez has been highly profitable. Its net margin was about 28 percent in the past four quarters. The company failed in its recent efforts to acquire Hershey Co., which would have been quite a coup. But even without Hershey, it looks to me like a company likely to show continued success.
National Coverage
Trade Coverage
Full Text of Stories Below
Local Coverage
Add recipients
Suggested