Nov. 9, 2009 (U.S. Equity News) --
Food industry alert provided by U.S. Equity News. By: Marcos S. Villegas
Nov 09 (www.usequitynews.com, www.FinancialNewsUSA.com)
--English candy maker Cadbury (Cadbury Plc) shot down Kraft Foods second attempt of a buyout on Monday, for an estimated amount of $16.3 billion. Kraft foods had put an offer on the company earlier this year in September for a slightly larger amount of $16.7 billion.
Roger Carr, chairman of Cadbury was quoted as saying that " Kraft's offer does not remotely come close to reflecting the true value of our company." Though the current propsal on the table is lower than the intial one, Kraft chief executive Irene Rosenfield in a statement quoted "We believe that our proposal offers the best immediate and long-term value for Cadbury's shareholders and for the company itself compared with any other option currently available, including Cadbury remaining independent." Roger Carr on the other hand belives the option of being incorporated into the Kraft business model is an "unattractvie prospect," for the company.
Whats next? It may seem the deal may be dead in the water but Kraft still has time to appeal directly to Cadbury's shareholders. Laws give Kraft about a months time to draft a proposal to present to the english companies shareholders and a additional sixty days to campaign for the takeover to make it a reality. Chairman Roger Carr is urging shareholders to reject any such offer, citing that the current offer is lower than the orginal and lower than Cadbury share price, thus making it unattractive to all shareholdres. Part of Krafts deal to Cadbury shareholders is offering $5 cash and 0.26 share in the Kraft company. For shares of the company that are trading in the United States and those who have shares here Kraft is offering stockholdres $20 cash and 1.04 shares in Kraft.
With the annoucement Cadbury (CBY) shares rose 1.5% by mid day, coming back up from a 2% deficit. Kraft on the other hand was down 1% by midday.
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