US/UK. Kraft Foods today sweetened its hostile bid for Cadbury as the likelihood of a critical consolidation in the confectionery sector strengthened.
The US confectionery-to-foods giant added new cash to its takeover offer, having simultaneously announced the sale of its North American frozen pizza business to Nestlé for US$3.7 billion.
At the same time Nestlé told the UK Takeover Panel that it was ruling itself out of the race for Cadbury.
Kraft said it is also extending its offer until on 2 February 2010.
Kraft said today that Cadbury shareholders can opt for an additional 60p in cash instead of the Kraft shares they would otherwise get under the terms of the original offer (300p in cash and 0.2589 Kraft shares for each Cadbury share).
“Kraft Foods is doing this because of the desire expressed by some Cadbury security-holders to have a greater proportion of the offer in cash and because Kraft Foods shareholders have expressed a desire for Kraft Foods to be more sparing in its use of undervalued Kraft Foods shares as currency for the offer,” Kraft said in a statement.
As reported, Kraft Foods made a hostile US$16.4 billion bid to acquire Cadbury in November. The offer has been soundly rejected by Cadbury, which said it “does not come remotely close to reflecting the true value of our company”.
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MORE COVERAGE OF THE CADBURY TAKEOVER STORY
Hostilities increase as Kraft slams Cadbury defence – 15/12/09
Kraft makes US$16.4 billion takeover bid for Cadbury – 9/11/09
