Shares of iconic chocolate maker Hershey surged by 13% on Monday after reports that Oreo owner Mondalez approached the company about a potential takeover.
According to Bloomberg, the talks between Mondalez and Hershey are currently in preliminary stages. If successful, the tie-up would create the largest candy company in the world.
This isn’t the first time Mondalez has tried to acquire Hershey. In 2016, the company approached Reese’s Pieces owner with a $23 billion offer that ended up being rejected.
Following the report, Hershey’s stock traded at $197.40 per share on Monday compared to Friday’s close price of $174.73. The current price of shares gives the company a market valuation of $39.93 billion. This means that the potential deal with Mondalez would be the biggest of the year, surpassing the $36 billion acquisition of Pringles maker Kellanova by Mars back in August.
The shares of Mondelez, on the other hand, dipped by 2% and traded at $61.66 per share on Monday. The company has a market cap of $82.5 billion.
Any deal for Hershey would need to be approved by The Hershey Trust Company, a charitable trust that owns the majority of the company’s Class B stock, which gives it roughly 80% of the voting power. It is unclear whether the trust would be open to relinquishing the control, although it has been recently selling some of its shareholdings.