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Published on April 29, 2008

When Buffett earlier invested in the petroleum business in China, others followed and made a lot of profit.

This time, it is possibly a candy business.

The Wall Street Journal reported that Mars and Warren Buffett's Berkshire Hathaway may be close to buying Wm Wrigley Jr for more than $22 billion (Bt698) in a deal that would combine two of the biggest US candy makers.

The purchase of the maker of Doublemint gum, which had a market value last week of 17.1 billion, may be announced very soon, The Wall Street Journal and The New York Times reported, citing unidentified sources familiar with the matter.

Uniting closely held Mars - the Hackettstown, New Jersey- based maker of Snickers and M&Ms - and the 117-year-old Wrigley, would create a company that would compete with chocolate maker Hershey and Cadbury Schweppes, the world's largest candy maker. US candy companies are exploring combinations as competition intensifies and milk and sugar prices rise.

Wrigley's sales may grow 9 per cent this year, the slowest pace since 2000, according to the average estimate of nine analysts surveyed by Bloomberg.

Competition from London-based Cadbury's Trident and Dentyne gums in the US has eroded its market share.

In 2006, Chicago-based Wrigley named former Nike CEO William Perez president and CEO, the first person outside the Wrigley family to head the world's biggest chewing-gum maker.

The trust that controls Hershey discussed ways to merge the chocolate company with Cadbury in a way that wouldn't decrease the trust's ownership, the Journal reported last year.

Since November 2006, Mars' share of the US chocolate market has increased 1.3 per cent, while Hershey's market share has fallen 2.3 per cent, Alexia Howard, a Sanford C Bernstein analyst wrote in an April 11 note to investors.

The terms of the purchase weren't immediately clear Berkshire Hathaway may have been prepared to provide financing and become a stakeholder in Wrigley.