Hershey, the confectionery firm behind iconic American brands such as Hershey's Kisses and Reese's Peanut Butter Cups, has effectively put itself up for sale.

As much as I'm an advocate of food industry consolidation, Milton Hershey must be rolling in his grave

John McMillin, Prudential Securities

The Milton Hershey School Trust, a charitable foundation which owns one-third of Hershey shares but controls three-quarters of votes, wishes to sell its stake with the aim of diversifying its holdings.

The news sent Hershey shares soaring 21% on the New York Stock Exchange, valuing the firm at $10bn.

Now, analysts say multinational food firms such as Nestle, Cadbury Schweppes and Kraft could bid as much as $13bn for the company, which has an unrivalled profile on the US market.

Difficult decision

The Milton Hershey School Trust, which provides free residential education to about 1,200 disadvantaged children in Pennsylvania, said it had made the sale decision "with reluctance".

The firm has 125 years of history behind it

But the sale was "the best way to accomplish the trust's diversification objectives and maximise value," the trust said.

In May, Hershey said it planned sell some of its non-chocolate confectionery brands, including the Wunderbeans and Chuckles product lines.

The disposals formed part of a wider shake-up which triggered a six-week strike involving 3,000 workers at two plants.

End of an era

A sale of Hershey would bring to a close 125 years of history, since Milton Hershey founded his first candy shop.

"As much as I'm an advocate of food industry consolidation, Milton Hershey must be rolling in his grave," said Prudential Securities analyst John McMillin.

The decision comes amid a wave of consolidation in the food industry, which has seen the disappearance of a swathe of once-legendary industry names.