Hershey Trust Co., the $12 billion charity that controls the Hershey chocolate company, reached a tentative agreement with the Pennsylvania attorney general, a move that would reform the governance practices of the controversial organization.
“We have reached an agreement in principle and are working on the final details in productive discussions with the office of the attorney general,” a spokesman for the trust said in an e-mailed statement. The attorney general’s office didn’t immediately respond to a request for comment after business hours.
The trust, which has faced allegations of lavish spending by board members in recent years, controls the fate of the maker of Hershey Kisses and Reese’s Peanut Butter Cups through its voting shares. Established in the early 1900s by Milton Hershey, the organization runs a school for low-income students and oversees the Hershey Entertainment & Resorts company.
Scrutiny of the trust grew last month after Hershey rejected a $23 billion bid by Mondelez International Inc. The charitable organization controls 81 percent of Hershey’s voting shares, so any deal would have to get its approval. That’s made the effort to change its governance practices of strong interest to Hershey investors.
The chocolate maker, struggling with an ill-fated expansion in China and sluggish U.S. sales, has long been seen as a takeover target -- with the trust serving as the main obstacle to a buyout.
Joan Steel, a Hershey Trust board member since 2012, resigned earlier this month.
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