The bitter-sweet saga of Cabdury’s desperate fight to stay independent is finally over, with the UK group’s board succumbing to a revised £11.9-billion ($19.7 billion) offer from US-based Kraft Foods after almost four months of bitter opposition. The makers of Toblerone chocolate and Oreo cookies launched a hostile bid for Cadbury in September last year, but struggled to find favour with the UK firm, which as recently as last week derided Illinois-based Kraft as an “unfocused conglomerate”.
The deal will create the world’s largest confectioner, but few seem to like it. Kraft takes on a heavier debt load, and its shares fell, whereas in Britain, where John Cadbury started his eponymous company in 1824, the news has been received with almost universal misery, even among Cadbury shareholders who now say they will accept the new offer.
Kraft sees pretax cost savings of at least $675 m annually realised by end of 3rd year at implementation cost of $1.3 b. Return on investment well in excess of cost of capital
increased scale for both because in developing markets such as Brazil, Russia & China, Kraft has a stronger presence, and India, Mexico and South Africa, Cadbury holds leading positions