Mondelez International Inc. (NASDAQ:MDLZ) (2.0%) (MDLZ – $43.90 – NASDAQ) headquartered in Deerfield, Illinois, is the renamed Kraft Foods Inc. following the tax-free spin-off to shareholders of the North American grocery business on October 1, 2012. MondelÄ“z’s approximately $26 billion of revenue is derived primarily from snacking, which includes leading brands such as Oreo, LU and Ritz biscuits, Trident gum and Cadbury and Milka chocolates. On July 2, 2015 MondelÄ“z combined its coffee business with DE Master Blenders 1753 to form a new coffee company, Jacobs Douwe Egberts. Subsequently, MDLZ exchanged part of its stake in this coffee joint venture for 24% ownership in Keurig Green Mountain, which was acquired by an investor group led by JAB Holding Co. in March 2016. This narrows the company’s product focus, as only 15% of revenue will be outside snacks — mostly Tang beverages and other products, such as Philadelphia cream cheese, which management may look to divest in the future as it executes on its plan to accelerate growth and improve margins in the faster-growing snack business. On August 26, Mondelez confirmed that discussions relating to a potential combination with Hershey had ended. Hershey initially confirmed on June 30 that it received and rejected a preliminary indication of interest from MondelÄ“z to acquire Hershey for $107 per share in cash and stock, demonstrating Mondelez’s continued interest in pursuing acquisitions while remaining an independent company.
From Mario Gabelli (Trades, Portfolio)'s Equity Income Fund 3rd quarter 2016 commentary.
