UPDATE 2-Mars Inc buying out Buffett stake in Wrigley
(Recasts; adds Buffett and Mars comments, background on Mars acquisition of Wrigley and Berkshire investments, bylines)
By Jonathan Stempel and Gayathree Ganesan
Oct 6 (Reuters) - The candy maker Mars Inc on Thursday said it would take full control of its Wrigley chewing gum business, acquiring the minority stake held by Warren Buffett's Berkshire Hathaway Inc.
Mars plans to combine Wrigley with its chocolate business, putting M&Ms, Snickers, Starburst fruit chews, Doublemint and Extra gum, and Altoids mints under one roof.
In 2008, Berkshire invested in Wrigley when it acquired $2.1 billion of preferred stock and $4.4 billion of bonds in connection with privately held Mars' $23 billion purchase of the chewing gum maker.
The bonds were repurchased in 2013, and Berkshire expected Mars to redeem half of the preferred stock, which carries a 5 percent dividend, by early January. Mars will instead redeem all of it. Terms were not disclosed.
"I have enjoyed all of Berkshire's experiences with the Mars family and management and wish them the very best," Buffett said in a statement. "Both Mars and Berkshire have profited from our investment and that's the way it should be."
The global confectionery business, worth $183 billion last year according to Euromonitor International, has struggled as more consumers move toward healthier foods, prompting some retailers to reduce shelf space for processed and sugary snacks.
"We are grateful for the strong and productive partnership we have with Warren Buffett and Berkshire Hathaway," Mars Chief Executive Grant Reid said in a statement. "Sole ownership of Wrigley provides us with an opportunity to rethink how we simplify our chocolate and Wrigley businesses." Continued...