Does Hershey have a kiss for Cadbury

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Hershey, Pennsylvania: To LeRoy Zimmerman, the taste of chocolate will always mean Hershey’s. But now the head of the charitable trust that controls the Hershey Company must contemplate a risk-everything deal that would tie its fate to the much larger British chocolatier Cadbury Plc.

“I was born and raised in this area—not in Hershey, but in Harrisburg—and to me the taste of chocolate is Hershey’s,” said Zimmerman, who heads the eight-member Hershey Trust. “I mean that. I’ve eaten in Europe all that stuff that’s there. But the taste of chocolate is Hershey’s to me and millions of Americans,” said Zimmerman at the doorstep of his spacious home on a leafy suburban street outside Harrisburg.

Zimmerman is seen as one of the leading figures pushing for change at Hershey as it contemplates a $17 billion-plus David-eats-Goliath bid for Cadbury. It would also stare down US food group Kraft, which is in the midst of a hostile takeover campaign for Cadbury. Zimmerman, now in his mid-70s, became Pennsylvania’s first elected attorney general in 1980 and now serves as senior counsel at the law firm Eckert Seamans Cherin & Mellott. Known as a “power broker of central Pennsylvania.”

Approached on two occasions this week, Zimmerman would not talk about the effort to orchestrate financing and political support for a deal that would require the 100-year-old Hershey to take on a company more than twice its size. However, it is clear that Zimmerman, whose firm keeps two large jars of Hershey kisses in its lobby, may risk taking on an ambitious deal that could change the identity of Hershey. Doing nothing could allow Kraft to create the world’s largest confectioner with Cadbury, ahead of current leader Mars-Wrigley.

Hershey missed an attempt to sell itself to Wrigley in 2002 as the Trust came under pressure from community groups, while a previous effort to link up with Cadbury in 2007 also fell apart. Those same tensions could be at work in a new deal, according to people familiar with the company.

“If you look at what extremes the Trust would have to accept in order for Hershey to be able to acquire Cadbury, it actually violates one of the fiduciary responsibilities of the Trust where you’re putting everything at risk,” said a former employee, who worked with the company for 30 years.