Hershey Trust forces a sweeping overhaul of the Hershey board

15 November 2007

The trust asked six of the company''s 11 directors to resign. Two others resigned on their own, the company said. Among those who resigned was Robert Campbell, who had been scheduled to take over as non-executive chairman on 1 January 2008.

The chocolate maker - whose most well-known brands are Hershey Kisses and Reese''s Pieces - has struggled in the past two years with rising costs and tough competition from M&Ms maker Masterfoods USA, a subsidiary of Mars Inc.

Last month, Hershey reported a staggering 66 per cent drop in quarterly profit.

Just a few weeks earlier, chief executive Richard Lenny resigned from the company. Media reports said he had strong differences with the trust, and was not given the autonomy to run the business the way he wanted.

The Wall Street Journal also reported that members of the trust met with Cadbury Schweppes Plc to discuss a possible merger. Lenny was not invited to the meeting. Cadbury is separating its candy and drinks businesses.

New board members include Stone Point Capital CEO Charles Davis, formerly head of investment banking services at Goldman Sachs, and Edward Kelly, managing director of private equity firm The Carlyle Group.