News Report #2

Kraft Foods take over of Cadbury

Kraft Food  wants to takeover Cadbury for a price of 16.7 billion. Cadbury thinks that this offer is to low and wants more money. Cadbury shares went up 41 percent in London trading and some people would say that Cadbury is worth 43 percent more than what Kraft offered. If Kraft were to join with Cadbury there revenue for next year would be as much as 50 billion. If Kraft could takeover Cadbury it would help them compete with other top compines such as Nestle witch is there biggest rival. Cadbury is most popular over seas in countries such as India and Britain and if Kraft gets Cadbury, they get those countries also. Nestle does not have a gum business and Kraft does, so getting Cadbury would put Kraft over Nestle. The takeover bid for Cadbury came at a really bad time for the company. Todd Stitzer states, ” The company is halfway through its plan to increase operating profit margins to about 15 percent in 2011, from about 10 percent in 2007. Cadbury’s shares have risen about 33 percent since it spun off its Dr Pepper beverage unit in 2008.” Ms. Rosenfeld Kraft’s chief executive, had a meeting with Cadbury’s chairmen, Roger Carr, in this meeting Cadbury denied Krafts proposal. Rosenfield wanted to make the make the offer public to encourage further discussions.

Citation

http://www.nytimes.com/2009/09/08/business/global/08food.html?_r=1&ref=business

Rebuff by Cadbury Doesn’t Deter Kraft

Julia Werdigier(writer)