Ferrero International, the maker of Ferrero Rocher chocolates and Nutella, has offered to buy Thorntons for around £112m.
The chocolate giant has agreed to pay a 145p share to take over Thorntons, which has struggled in recent times as sales have declined.
At Christmas, the chocolate brand issued a profit warning, which was followed by lower-than-expected sales in April.
Today’s announcement shows that Ferrero now has a 29.9% stake in Thorntons, ahead of the expected full takeover.
The deal aims to strengthen and grow the brand in the UK.
Thorntons chairman Paul Wilkinson said: “Ferrero is offering our shareholders an attractive premium to the average price of Thorntons’ shares over the last three months. Although the prospects for Thorntons as an independent company remain strong as the company embarks on the next phase of its strategy, the board of Thorntons also recognises the potential benefits to the brand and the business, including employees and all stakeholders from combining with the Ferrero Group.
“Ferrero is a successful global confectionery business with a strong family heritage and as such represents a good cultural fit for Thorntons. The board of Thorntons therefore has given its unanimous recommendation for the offer from Ferrero.”
Ferrero chief executive Giovanni Ferrero added: “This transaction brings together two highly complementary businesses, but more importantly it unites two companies that share the same passion for growing brands, and a proud heritage, drive and culture built upon their family foundations.
“We have long admired Thorntons and what they have achieved in the UK as demonstrated by their tremendous customer loyalty, and we look forward to working with their experienced team.”