Hershey to buy China candy maker for $584M

10:34 AM, Dec 19, 2013   |    comments
NEW YORK - JULY 31: The Hershey's Foods logo is shown at the unveiling of the world's largest Hershey's Kisses chocolate at the Metropolitan Pavilion July 31, 2003 in New York City. (Photo by Lawrence Lucier/Getty Images)
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USA TODAY - A previous version of this story incorrectly said that Hershey was Dutch-owned.

Hershey's purchase of Chinese candy maker Shanghai Golden Monkey Food Co., sounds like a match made in confectioner's heaven.

The Hershey, Penn.-based maker of chocolate Kisses and Reese's candies has agreed to pay $498 million for the Chinese company, which makes snacks including Wedding Day candies and My Love chocolates. Hershey will also assume $86 million in debit.

Hershey's subsidiary Hershey Netherlands B.V. will acquire 80% of Shanghai Golden Monkey's stock by mid-2014 and the remainder in 2015. Shanghai Golden Monkey Food has five production sites and is expected to its growing revenue is expected to hit $225 million this year. It makes more than 200 varieties of candy and snacks marketed throughout China and also sold across Southeast Asia, as well as the U.S., Australia, New Zealand, Russia, Mongolia, Kazakhstan and Latin America.

The acquisition is part of Hershey's move to expand its operations in China. Back in May, Hershey opened an Asia Innovation Center in Shanghai.

"Shanghai Golden Monkey is the type of business we've been focused on for potential M&A," said Hershey International president Humberto P. Alfonso in a statement accompanying the acquisition. "It fits Hershey's acquisition criteria: it is located in our primary international market, China; it is a pure play confectionery and snacks company; and it has distribution into channels where Hershey products have yet to penetrate. Additionally, the company has a strong history of innovation and product quality as evidenced by the outstanding reputation of its core brand, Golden Monkey, which has been nationally recognized as one of China's most iconic brands."


(Copyright © 2013 USA TODAY)

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