(Adds analyst comment, details, updates shares)
By Sruthi Ramakrishnan and Nayan Das
Jan 21 (Reuters) - The chief executive of Tootsie Roll Industries Inc has died after more than half a century at the helm of the U.S. candy maker, sparking speculation that the company could soon be ripe for acquisition.
Tootsie Roll's shares rose as much as 8 percent to a 17-month high of $33.28 on Wednesday.
Melvin Gordon died, aged 95, after a brief illness, according to a statement from the company he had headed since 1962. His wife, Ellen Gordon, takes over as chief executive.
The Tootsie Roll is named after the daughter of an Austrian immigrant, Leo Hirshfield, who first produced the chewy chocolate candy in a small New York City store in 1896. Now based in Chicago, the company has a market capitalization of about $1.9 billion.
Ellen Gordon, who is in her 80s and was previously chief operating officer, is the company's largest shareholder, with a 26 percent stake as of March 14. Melvin Gordon had a 21.9 percent stake as of Dec. 12.
"There's been speculation for years that it's going to be sold," said Timothy Chen, analyst at Rhone Trading Partners.
Growing through acquisitions, Tootsie Roll became the world's largest maker of lollipops when it bought The Charms Co in 1988.
It later acquired Sugar Daddy and Junior Mints and, in 2004, Concord Confections, adding Dubble Bubble and Wack-o-Wax to the candies it produces.
After four straight years of growth, though, Tootsie Roll reported revenue of $543.4 million for 2013, a 1.2 percent drop.
One of the oldest CEOs of a U.S. company, Gordon rarely gave interviews.
The company was well-known, however, for its commercials: it claims to have received more than 20,000 letters from children trying to answer a question posed by an owl in a 1970s commercial: how many licks does it take to reach the center of a Tootsie Pop?
Elliott Schlang, managing director of the Great Lakes Review, said the popularity of Tootsie Roll's brands, as well as its real estate assets in Chicago and the fact that Gordon's children are not directly involved in the business, make the company an attractive target.
Schlang said the company could be a target for candy makers, including Warren Buffett's Berkshire Hathaway Inc through its See's Candies division. Berkshire Hathaway did not immediately respond to a request for comment.
Tootsie Roll's shares closed up 7.1 percent at $32.99 on the New York Stock Exchange. (Additional reporting by Siddharth Cavale; Editing by Saumyadeb Chakrabarty and Simon Jennings)