Cadbury Rejects Kraft Buyout Offer
American food giant Kraft tried to buy out UK candy stalwart Cadbury, but Cadbury rejected the Kraft buyout offer.
One problem facing a potential American takeover of Cadbury is that Cadbury is seen as a paragon of responsible British corporate culture, whereas Kraft is percieved as being run by Montgomery Burns. Of course, in reality, Cadbury has been cutting jobs and costs just like every other major corporation.
Also working against the American company is that Kraft wants to cut overall operating costs in the hypothetically-merged conglomerate by over $700 million per year, which would certainly mean layoffs in a country already hard-hit by recession.
Kraft pounced this morning, tempting investors with £3 in cash per share plus shares in the enlarged group that together valued each Cadbury share at 745p and the whole company at £10.2bn. News of the approach sent Cadbury's shares jumping as much as 40% as City traders bet that more money could be squeezed out of the Americans, with some attaching a much higher price tag.
Kraft is not giving up so easily, and believes it can bring Dairy Milk and Creme Eggs beneath the same brand umbrella as Kraft Macaroni & Cheese and Maxwell House coffee.
I love those Chocolate Oranges, and I love Dairy Milk, but should they be made by the same company?