Hershey CEO sees no "roadblocks" from Trust

BOCA RATON, Florida (Reuters) - Hershey Co (HSY.N) CEO David West does not think the charitable trust that has the controlling vote at the largest U.S. chocolate maker stops him from running the company the way it should be run.

"I don't feel any roadblocks because of that ownership structure," West said during an interview on the sidelines of the Consumer Analyst Group of New York conference.

Hershey is getting ready to battle the new No. 1 in the world confectionery business when Kraft Foods Inc (KFT.N) closes its $18.4 billion acquisition of British confectioner Cadbury in the coming weeks.

Hershey tried to mount a counter bid for Cadbury, but stepped away after Kraft and Cadbury reached an agreement after a five-month hostile takeover battle. Published reports painted a rift between West and the Hershey Trust, which owns a controlling stake in the company.

West did not discuss the specifics of his relationship with the trust, but stressed Hershey Co's board, of which he is a member, is independent with a fiduciary duty to focus on "creating value for all shareholders."

Hershey will now have to create that value in a more consolidated global candy market, where Kraft and Mars Inc will each control about 15 percent of sales.

West said Hershey has the balance sheet to make its own sizable acquisition and said there may be some regional confectionery companies that could be more receptive to being acquired after the Kraft/Cadbury and Mars/Wrigley deals.

West would not comment on companies that could be available, but analysts said some that could fit the description include Swiss chocolate maker Lindt (LISP.S), Perfetti Van Melle and Lotte Confectionery Co Ltd (004990.KS), the Asian chocolate company Hershey has a joint venture with.

Analysts said West seemed more aggressive on making acquisitions and noted that saying the company could do a sizable acquisition was different from most other packaged foods executives, who have talked more about smaller deals.

Even as he talked about larger acquisitions, West said the company did not need to make a big deal overseas to meet its goal of annual 3 percent to 5 percent sales growth. The U.S. business is growing at about 3 percent to 4 percent and the company's current international business is also increasing, he said.

From 2004 through 2009, Hershey's sales outside the United States and Canada grew at a compound annual growth rate of 14 percent, or 20 percent when acquisitions are included.

In the United States, the company is trying to work more with retailers to help increase business, including reconfiguring candy aisles and checkout counters to encourage more candy sales.

Hershey also said it still expects 2010 sales growth of 3 to 5 percent and adjusted earnings per share growth of 6 percent to 8 percent.

Hershey shares gained 78 cents or 2.1 percent to close at $38.38 on the New York Stock Exchange on Tuesday.

(Reporting by Brad Dorfman; editing by Andre Grenon)