MILAN (Reuters) - Michele Ferrero, Italy's richest man and the owner of a global chocolate and confectionery empire, has always resisted the temptation to allow outsiders to buy into his company.
In a statement on Thursday, his son Giovanni, the Chief Executive of the Ferrero group, rejected suggestions the Italian company had been approached by larger Swiss competitor Nestle and said Ferrero was not for sale.
But like other family-controlled Italian companies that flourished in the postwar boom, the ambassador of chocolate-hazelnut spread Nutella, now 88, may soon be discussing succession plans.
His other son Pietro, the chosen heir to run the Piedmont-based empire, died of a heart attack in 2011 while riding a bicycle in South Africa. He was 47 and his death opened the way for the ascent of younger brother Giovanni, whom industry insiders consider less interested in running the business.
"There is certainly an issue of succession," said a financial source with knowledge of the situation. "Either the father opens up to an external management team, or he sells it."
However other sources said the family may decide to continue without making such changes.
The Ferrero group, also known for its Ferrero Rocher pralines and chocolate Kinder eggs, is seen by analysts and bankers as Italy's most valuable privately owned company.
While many cash-strapped Italian companies, including telecoms operator Telecom Italia, are in crisis or being sold to foreigners, Ferrero continued to grow even through the current economic downturn, Italy's longest in 60 years.
With sales of nearly 8 billion euros, bankers say Ferrero could be worth as much as 18 billion euros.
This would put it at par with listed luxury eyewear maker Luxottica, where ageing founder Leonardo Del Vecchio has successfully handed over to an external chief executive.
Fashion house Armani, another Italian global brand that has remained private and could face a succession issue, has an estimated market worth of at least 6 billion euros.
A man of few words who shuns publicity, Ferrero senior has turned a Piedmont-based chocolate factory into a world giant. He is known for running Ferrero with an iron fist but is also loved by locals for a tendency to give back to his community and by employees for the company's generous working conditions.
Up until a couple of years ago, Michele would commute daily by helicopter from his Montecarlo villa to the company headquarters in the northwestern provincial town of Alba to take an active role in the tasting and designing of new products.
But Pietro's death has left patriarch Michele, who controls the Ferrero group, deeply shaken. While some insiders say Michele remains active and in good health, others say the notoriously workaholic industrialist has lost some sparkle.
The company, which nearly four years ago toyed with the idea of making a bid for British rival Cadbury, has not made a single acquisition since it was set up in 1946.
It is cash-rich and not in an immediate need of financing, several bankers and people familiar with the situation said.
"While Michele is alive, it's difficult to think about a sale but not impossible," said an insider when asked about a possible tie-up with Nestle or another competitor.
"If he realizes that his family is not in a position to run the company, he would maybe sell it. In any case, it is Michele who decides as he controls the company."
Nestle, which has denied any plans to carry out a major acquisition in the short-term, already has a strong foothold in Italy, having acquired over the years such historic brands as pasta-maker Buitoni, chocolate-maker Perugina and mineral water group San Pellegrino.
Analysts say Nestle and Ferrero would make a good fit but see some overlaps in North America, where both companies have a large presence. A merger of the two could potentially turn the Ferrero group into Nestle's biggest single shareholder.
Additional reporting by Anjuli Davies in London and Silvia Aloisi in Milan; Editing by Giles Elgood