Hostile bid for Cadbury renewed

Northfield, Ill.-based Kraft Foods Inc. renewed its bid for Cadbury PLC offering the same terms as its original bid, which was rejected in September by the London-based confectionery company.

Cadbury once again rejected the offer of 300 pence in cash and 0.2589 new Kraft shares for each Cadbury share. This offer values Cadbury at 713 pence per share and an entire issued shared capital of $16.5 billion, slightly lower than the original offer because Kraft's shares are down.

"We remain convinced of the strategic merits for both companies of combining Kraft Foods and Cadbury," said Irene Rosenfeld, Kraft's chairman and CEO. "We believe that our proposal offers the best immediate and long-term value for Cadbury's shareholders and for the company itself compared with any other option currently available, including Cadbury remaining independent."

Cadbury Chairman Roger Carr disagrees. "The repetition of a proposal which is now of less value and lower than the current Cadbury share price does not make it any more attractive," he said. "As a result, the Board has emphatically rejected this derisory offer and has strengthened its resolve to ensure the true value of Cadbury is fully understood by all."

Will Kraft's clout win out in the end? We will all have to wait and see.