Mars buys out Berkshire Hathaway stake to take full control of Wrigley
Mars accelerated timeline to repurchase the holding company’s shares.
Mars, Inc., announced Thursday it will combine its chocolate segment and its Wrigley subsidiary to form a new division, Mars Wrigley Confectionery, further cementing Mars’ status as a global confectionery leader.
The consolidation comes after the Snickers and M&MS manufacturer purchased the remaining stake in Wrigley held by Warren Buffett’s Berkshire Hathaway. Buffett and his holding company helped Mars acquire the chewing gum giant under an agreement that allowed Mars to repurchase Berkshire Hathaway’s share over time.
“We are grateful for the strong and productive partnership we have with Warren Buffett and Berkshire Hathaway,” says Grant F. Reid, Mars president and ceo. “It is a great relationship that has yielded value on both sides. We’re equally pleased that sole ownership of Wrigley provides us with an opportunity to rethink how we simplify our chocolate and Wrigley businesses so that we can bring a more holistic approach to this vibrant category.”
Martin Radvan, Wrigley’s global president and a 30-year veteran of Mars, will lead the new division, which has 30,000 employees in about 70 countries. It will be headquartered in Chicago, Wrigley’s longtime home.
“Mars Wrigley Confectionery brings together two great businesses, strengthening our ability to create win-win relationships with our customers, and improving our opportunities to address dynamic retail and consumer trends together,” Radvan says.
Mars purchased Wrigley in 2008 for almost $23 billion, with a $4.4 billion loan from Berkshire Hathaway that has since been repaid. The Financial Times reported the original agreement allowed Mars to purchase half of Buffett’s stake in 2016 and the rest in 2021. However, Mars opted to expedite the purchase.
For now, Mars Chocolate and Wrigley will operate separately, Mars said in a news release. Jean-Christophe Flatin will continue as president of Mars Global Chocolate and Casey Keller, previously regional president of Wrigley Americas, will become president of Global Wrigley. The consolidation will be phased in next year.
Mars’ consolidation follows a September announcement from Mondelez that the Illinois-based company would expand its presence in the U.S. chocolate market through focus on its Oreo and Green & Black brands. Mondelez dropped a bid to acquire The Hershey Co. in August.
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