The Hershey Company's (NYSE: HSY) turmoil continues. After a continued decline in net income and stock price, the board, controlled by various Hershey trusts, announced yesterday its intent to take the steps necessary to reverse the trend.

The company has suffered an unfortunate coincidence of declining sales at the same time it is making a heavy investment in a new plant in Monterrey, Mexico. Ironically, the board killed a potential sale of the company several years ago, partly in response to fears that massive job losses in its American manufacturing plants might result.

Since then, the board has become more aggressive, while maintaining its firm intent to remain in control of the company. The Wall Street Journal's Julie Jargon [subscription] today reviewed the oft-speculated possibility that one of the companies that bid on Hershey's in 2002, Cadbury Schweppes PLC (NYSE: CSG), might split off its candy business and merge it with that of Hershey's. For such a deal to work, however, one of two things need to happen. Hershey could buy that portion of Cadbury Schweppes, which would require it to take on a heavy debt load that would be hard to justify given its recent performance, or the Hershey board will have to change its mind about selling off the business.

Given Hershey's new manufacturing capacity, such a merger makes even more sense in terms of production and logistics. Not coincidentally, the company announced last week that CEO Richard Lenny will retire at the end of the year. Look for the board to hire a new CEO who can find a way to structure such a deal.

In a move to divest itself of products inconsistent with their goal of "centering on convenience, wellness and quality," Campbell Soup Co. (NYSE: CPB) is prepared to put its boutique chocolate brand Godiva Chocolatier on the market.

The luxury product should find an eager market, as it has been a solid performer for Campbell with sales increasing by double digits in 2006 on annual sales of approximately $500 million. The company has over 270 retail locations as well as direct sales, and its products are also available in groceries and other stores.

Godiva was founded over 75 years ago in Brussels, Belgium by the Draps family. Campbell's bought a third of the company in 1966, subsequently taking over ownership. They have deftly kept the brand separate from the Campbell's brand, shaping the Godiva image as a gourmet product and haute culture indulgence.

According to The Wall Street Journal [subscription], market analysts speculate that Godiva could bring between $750 million and $1 billion. Centerview Partners LLC has been retained as the financial advisor for the deal.