Mondelez Focuses on Smaller Acquisitions

Mondelez announced on Wednesday that it would concentrate on "bolt-on" deals, following reports that the Cadbury parent was considering an acquisition of Hershey.

Hershey's shares surged up to 19% on Monday after a Bloomberg report indicated that Mondelez (NASDAQ: MDLZ) had made preliminary moves toward a possible merger. However, they dropped about 5% in premarket trading on Wednesday, while Mondelez's shares rose around 3%.

The company reaffirmed its commitment to a strategy focused on acquiring smaller assets, citing recent purchases of Chipita, Clif, and Ricolino. Mondelez's acquisitions from 2022 each cost under $3 billion, while Hershey's market capitalization stands at roughly $38 billion, according to LSEG data.

Additionally, Mondelez announced a new share buyback program valued at up to $9 billion. This plan will commence on January 1, 2025, and remain valid through 2027, replacing the current $6 billion initiative.