Hershey and Ferrero Consider Buying British Cadbury

Though the Ferrero family's round Rocher chocolates are known all around the world, Michele Ferrero, and his two sons, have shunned publicity and kept their company very private.

Photo: Hershey and Ferrero Consider Buying British Cadbury

Now Ferrero, and its home base in this northwestern Italian town, is in the spotlight after it said it was considering a multi-billion euro bid for Cadbury, the world's second-largest confectionery company.

In more than 60 years of history Ferrero has not made a single acquisition as it built up a confectionery empire it says ranks fourth in the world.

Michele Ferrero, 84, who took the reins in 1957, lives in Monte Carlo and has a villa in exclusive Cap Ferrat. Forbes magazine this month estimated his and his family's wealth at $9.5 billion, putting them at 40th place among the world's richest people, Reuters reports.

It was also reported, the bidding war for Cadbury is heating up, but it still looks like Kraft will do the deal.

Hershey and Italian candy maker Ferrero SA are considering teaming up in buy British confectioner Cadbury, Forbes reports.

News agencies also report, the two companies said there was no guarantee they would end up making an offer, and gave no details whether a proposal would be friendly.

The mere hint of a potential rival offer -- which until now seemed unlikely -- could give Cadbury leverage to pry more money from Kraft, a source familiar with the situation said. The source declined to be named because he was not authorized to speak with the media.

Until now, Cadbury has stressed its growth prospects as an independent player to mollify investors who would view a sweetened Kraft bid as attractive. Last month, Cadbury posted strong quarterly results and raised both its sales and margin growth targets for 2009.

"Its message has been that it is growing and doesn't need to be part of a massive, slower growth American food conglomerate," said a second source familiar with the matter.

But that defense strategy came under pressure. As Kraft persisted in a waiting game since it made its offer public in early September and refused to sweeten its bid, Cadbury investors' hopes for a much higher offer receded, Reuters reports.