Trust chairman sees change at Hershey

CHICAGO (Reuters) - The chairman of the trust that has voting control over Hershey (HSY.N) said change is needed to boost the company's performance and improve the largest U.S. chocolate maker's position for long-term growth, but he ruled out a sale of the company.

Hershey Trust Chairman LeRoy Zimmerman said the trust, which controls 78 percent of the voting stock in the company, had hired merger-and-acquisition advisers more than a year ago to look at strategic options for Hershey.

Hershey shares fell more than 6 percent on Monday to their lowest since April 25, just days before Hershey rival Mars said it would by Wm Wrigley Jr WWY.N, which raised speculation Hershey might need to merge or form a joint venture to compete with Mars.

Hershey management is scheduled to meet with analysts on Tuesday to update them on the company's strategy.

"Transformational merger-and-acquisition transactions are but one of multiple strategic growth options the trust has been continually assessing, in coordination with the company board, as part of the trust's ongoing process and due diligence," Zimmerman wrote in an opinion piece published Sunday in the Harrisburg, Pennsylvania Patriot-News. (here#continue).

Zimmerman also repeated that the Trust will not, and legally could not, give up its control of the company.

"The trust is committed to retaining its controlling interest in the company," he wrote. "This is first and foremost a principle grounded in Milton Hershey's philanthropic legacy. It also is rooted in constraints of Pennsylvania law and practical business imperatives. Simply put: We will not sell The Hershey Co."

The Hershey Trust, which despite its control of the company holds shares representing only about 30 percent of the economic interest in Hershey, was established by Hershey founder Milton Hershey to serve as trustee for the boarding school that bears the Hershey name.

Last year the trust, unhappy with the financial performance of Hershey, arranged an overhaul of Hershey's board.