Board member of trust that controls takeover target Hershey resigns

Mon Jul 11, 2016 2:48pm EDT
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By Lauren Hirsch

(Reuters) - A board member of the charitable trust that controls Hershey Co (HSY.N: Quote) has resigned, the fourth such departure in less than 12 months, the trust said on Monday, at a time when the chocolate company is a takeover target for Mondelez International Inc (MDLZ.O: Quote).

While no explanation for the move was provided, the resignation came as the trust is locked in a bitter dispute with its direct overseer, the Pennsylvania Attorney General's office, over its governance.

The $12 billion trust, set up by Hershey founder Milton Hershey over a century ago to fund and run a school for underprivileged children, must approve any sale of the company. Its affairs have been in the spotlight since Hershey rejected Mondelez's $23 billion offer two weeks ago.

Joan Steel, a Hershey trustee, resigned over the weekend, trust spokesman Kent Jarrell said. He did not provide a reason for her resignation, but said the trust's board would continue to function with its nine remaining members until her replacement is named.

Steel could not be immediately reached for comment.

Hershey shares rose 2 percent after Reuters first reported the news and were trading down 0.6 percent at $110.00 at mid-afternoon in New York. Mondelez's offer last month, which was half in cash and half in stock, was worth around $107 per share, sources have previously said.

Steel's departure follows the resignations of Hershey trustees Richard Zilmer, John Fry and Stephanie Bell-Rose over the past year.

Bell-Rose resigned this spring, three months after her appointment, because the position required more time than she had expected and interfered with her responsibilities as senior managing director at TIAA-CREF Financial Services, Jarrell said.   Continued...

A Hershey's chocolate bar is shown in this photo illustration in Encinitas, California, U.S. January 29, 2015.  REUTERS/Mike Blake/File Photo