Hershey Scarfs Down Joseph Schmidt & Scharffen Berger

The Hershey Co. announced August 15 that its newly formed, wholly owned subsidiary, Artisan Confections Company, has acquired the assets of Joseph Schmidt Confections, Inc., a premium chocolate maker. San Francisco-based Joseph Schmidt is known for its artistic and innovative truffles, colorful chocolate mosaics, specialty cookies and handcrafted chocolates presented in distinctive packaging. These products are sold in select department stores and other specialty outlets nationwide as well as in Joseph Schmidt's stores located in San Jose and San Francisco. Hershey also has completed the previously announced acquisition of Scharffen Berger Chocolate Maker, Inc., one of the fastest-growing premium chocolate companies in the United States. Scharffen Berger, based in San Francisco, Calif., is known for its high-cacao-content, signature dark chocolate bars and baking products. The combined purchase price for Scharffen Berger and Joseph Schmidt will be between $46.6 million and $61.1 million, with the final amount reflecting actual sales growth through 2007. Together, these companies have combined annual sales of approximately $25 million. "The Scharffen Berger and Joseph Schmidt acquisitions are great strategic opportunities for Hershey to capitalize on the high-growth, on-trend premium chocolate segment," said Richard H. Lenny, Hershey's chairman, president and CEO. "These companies provide two distinct platforms to broaden our presence in the $1.7 billion premium segment. Scharffen Berger is a leader in the high-cacao-content, distinctive dark chocolate arena, while Joseph Schmidt specializes in fine, handcrafted chocolate gifts. We look forward to capturing the immense growth potential of Scharffen Berger and Joseph Schmidt as we further extend Hershey's leadership position in the U.S. confectionery market." For more information on Scharffen Berger Chocolate Maker, Inc., visit www.scharffenberger.com. For more on Joseph Schmidt, see www.josephschmidtconfections.com. Hershey's website is www.thehersheycompany.com.