Cadbury steps up its defence against Kraft's £10.2bn offer
Tuesday 15 September 2009
The chief executive of Cadbury will reinforce the confectionery group's growth strategy as a standalone business to investors this week, in the wake of last week's rejected £10.2bn takeover approach from Kraft.
Todd Stitzer will bolster Cadbury's defences against Kraft tomorrow by reaffirming its strategy – the details of which will be issued in a stock exchange announcement in the morning – at an event hosted by Sanford C Bernstein's analysts, where a number of Cadbury's investors will be present.
The news comes as Cadbury yesterday released a strongly worded letter that lambasted Kraft's offer. Roger Carr, the chairman of Cadbury, said: "Under your proposal, Cadbury would be absorbed into Kraft's low-growth, conglomerate business, an unappealing prospect which contrasts sharply with our strategy to be a pure play confectionery company."
In the letter to Irene Rosenfeld, chairman and chief executive of Kraft, Mr Carr added that its 745p-a-share proposal failed to reflect the potential synergies of a combined entity. Kraft refused to comment yesterday.
However, the City expects Kraft or another party to return with an improved offer for Cadbury. Yesterday, Bank of America Securities-Merrill Lynch analysts said a deal at 860p to 880p for Cadbury "still comfortably meets Kraft's financial criteria".
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