Kraft Issued 6-Week Deadline To Make Formal Cadbury Bid
30 September 2009 - 7:29PM
Dow Jones News
Kraft Foods Inc (KFT) was Wednesday given a six-week deadline to
either make a formal bid for Cadbury PLC (CBY), the U.K.
confectioner it has been stalking for the past three weeks, or walk
away.
In response to a request from Cadbury, U.K. regulator the
Takeover Panel issued its "put-up-or-shut-up" Wednesday. Kraft will
have to present a formal offer either to the Cadbury board or
directly to its shareholders by 1700 GMT, Nov. 9 or abandon its bid
to buy Cadbury for at least six months.
So far, Cadbury has only received an informal approach from
Kraft, which it immediately rejected. For the U.S. giant to make a
formal bid, it will need to have all of its financing in place.
Analysts believe it will also have to offer significantly more than
the 745 pence it indicated three weeks ago, when the deal was
valued at around GBP10.2 billion.
"We have made our position on Kraft's proposal very clear and we
welcome the Panel's decision today in the interests of obtaining
clarity and certainty for our shareholders and employees at the
earliest opportunity," said Cadbury Chairman Roger Carr in a
statement.
The deadline should focus the minds of the protagonists after
three weeks of claim and counter-claim from both parties which have
dominated the press but failed to move the deal closer.
Even so, it could still be many weeks, or even months before a
bid is finally accepted or rejected.
Company Web site: www.cadbury.co.uk/
Company Web site: www.kraftfoods.co.uk/
-By Michael Carolan, Dow Jones Newswires; 44-20-7842-9278;
michael.carolan@dowjones.com