Hershey and Nestle Plan For Cadbury

Vote it

London, Dec 07 (PRINTWORDS NEWS)- cadbury Hershey and Nestle Plan For Cadbury Leading UK based confectioner Cadbury has clarified that it will react formally to rival Kraft’s acquisition offer on 14th December. The company spokespersons said that Cadbury can not go public with its reaction about the offer until it makes a formal declaration owing to legal restrictions. Cadbury also said that the statement will also contain its trading update. Kraft came up with the formal takeover offer and the attempt resulted in cold and indifferent reaction from the UK. Cadbury did not pay much heed to the early offers of Kraft prompting the USA based food giant to become hostile. Kraft approached the Cadbury shareholders directly after being snubbed by it. Initially the industry insiders thought other major food groups will not be interested in Cadbury but their guess turned out to be wrong later.

In a recent statement, Lord Mandelson, the business secretary warned Kraft that it should not try to use Cadbury to make quick profits. He made it clear that Kraft will have to face strong opposition not only from Cadbury but also from the government of UK if it tries to use Cadbury for short term gains.

Cadbury has other reasons to snub Kraft’s offer. Its share price increased ever since the market became abuzz with the rumor that Nestle and Hershey are likely to enter the takeover race. The recent reports confirm that Those two giant food groups are indeed interested in Cadbury. Reportedly Hershey and Cadbury are involved in talks regarding the formation of a consortium that can be used to offer a sweeter deal for Cadbury.

The industry experts also believe that it would be better for Hershey and Nestle to approach Cadbury jointly rather than taking a solo approach. This would help them to come up with a more lucrative offer for Cadbury with more cash in it. Besides, Nestle alone can not acquire the whole of Cadbury group without facing pesky Antitrust problems. It may be interested in Cadbury’s gum segment though.