Hershey Chocolate Company, which is one the largest and most successful chocolate manufacturing enterprises in America, are among the firms that are planning to make an initial offer for the Nestle US Chocolate Company in order to absorb it, according to reports on Friday. Nestle US is famed for being the producers of such quality chocolate brands as Butterfingers, Laffy Taffy, Baby Ruth amongst many others.
Another Confectionery firm, Ferrara Candy Co. who produce the well-known ‘Lemonhead’ sweets’, are also expected a first bid also according to reports. Both of the above mentioned companies shall be challenged in this regard by private equity corporations. Ferrero Chocolate Company who are makers of the world famous ‘Nutella chocolate spread’ are said to be also in the running to make a bid.
Exploring A New Market
The Nestle company themselves in June made a statement that they would explore various options, particularly the selling option. Despite only having annual sales of $924 million, it expected to be sold off for a whopping $2.5 billion, according to a reliable source.
Also according to reports, due to the confidential nature of such bids and the growing competition, all the above mentioned companies have decline to disclose the exact figures of their offer to the press.
Hershey, who produces products like their headline product ‘kisses chocolate’, ‘Twizzlers’ and ‘Reese’s’ are at the forefront of the American chocolate and candy business. Adding Nestle to its fold would further improve their marketability and appeal on a worldwide scale.
It is still important to note that any such purchase of a rival company will mean a change in course for a company seeking to adapt to the ever-changing consumer preferences.
It is reported that Nestle is looking to shed its US branch due to low returns and a decrease in demand for its products in the country.