Blog: What now for Hershey?
Dean Best | 2 October 2007
Hershey’s chief executive has quit the company, so what now for the US confectionery giant?
Rick Lenny has decided to stand down from his positions as chairman, president and CEO at Hershey. The US confectionery business is awash with rumours that Lenny had grown frustrated with the company’s ownership structure.
Hershey is controlled by a trust set up by the company’s founder almost a century ago and there is a widely-held view that the trust has held back a business far too dependent on the US market.
As you can imagine, there has been no public comment from Lenny, Hershey or the trust on the reasons behind the executive’s departure, just the platitudes we normally see when a key actor leaves a company.
However, one analyst just-food spoke to today (1 October) agreed that Lenny was likely to have become irritated at Hershey’s inability to expand its business globally. The analyst said Hershey had become “land-locked” in North America and its global footprint compared unfavourably to the likes of Cadbury Schweppes and Wrigley.
Hershey has made attempts to expand outside the US and has also restructured its domestic operations to boost margins. But the market is now in something of a “wait and see mode”. Will Hershey now be put for sale? Would Hershey thrive as part of a larger company? Issues for all of us to chew on.
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