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Business News

Cadbury's jobs fears realised as Kraft wields axe

Kraft Foods has axed nearly three-quarters of Cadbury's staff who were covered by global contractual terms at the confectionery giant's head office, The Independent has learned.

Of the 165 senior managers at the company's headquarters, just 45 have been found new jobs within the enlarged Kraft Foods business, which took over Cadbury in January for £11.7bn after a bitter takeover battle.

The remaining 120 have all been made redundant by the company, whose global headquarters are in Chicago, Illinois. The revelation will only raise concerns that the company has allowed a "brain drain" to develop by losing the best of Cadbury's talent, many of whom had no desire to work for Kraft after the US multinational's controversial bid.

Politicians from the last government openly spoke out against a takeover of Cadbury by Kraft and unions claimed that thousands of jobs would be axed as a result.

Peter Mandelson, the former business secretary, was a vocal opponent, on one occasion warning Kraft against "making a quick buck" from Cadbury.

Controversy swiftly followed, when the US group reneged on a pledge to reverse Cadbury's decision to close its Somerdale Factory in Keynsham saying that plans to shift production were too advanced to be reversed. That led to a censure from the Takeover Panel.

News of the senior Cadbury redundancies comes at a time of renewed controversy over US groups using the dollar's strength against sterling to cherry pick the best of corporate Britain. Kraft's apparent insensitivity to any form of criticism will heighten fears about the impact a string of US takeovers will have on Britain.

The company has lost a string of senior Cadbury managers since it took over, starting with the departures of chief executive Todd Stitzer and his finance director Andrew Bonfield who resigned within days of Kraft's takeover. It also witnessed the departure of Phil Rumbol, who presided over a golden period in the chocolate-maker's advertising after joining in 2006.

Kraft had wanted Mr Rumbol to work in a pan-European marketing role across the enlarged business but the latter was not keen to relocate his family to Zurich, where Kraft's European chocolate category headquarters is based.

Mr Rumbol was responsible for the famous – and award-winning – "Gorilla" ads. Signs of a brain drain from Cadbury's increased at the end of May after it emerged that five senior executives were quitting the group. They included Mark Reckitt, who was Cadbury's chief strategy officer and the most senior executive left from the company within Kraft at the time. He had been jointly leading the integration of the two businesses alongside Kraft's Tim Cofer.

Mr Reckitt was the only member of Cadbury to report directly to Irene Rosenfeld, Kraft's chief executive.

A Kraft spokesman said of the 120: "We always were clear that the global head office would be in Chicago and therefore that the UK based head office employees would go into a consultation about redundancy."

Kraft has made the Cadbury centres at Bourneville and Uxbridge its UK bases.