Cadbury Rejects 2nd Kraft Bid

Chocolate and confectionery giant Cadbury has yet again rejected a takeover bid from Kraft, saying its new offer of £10bn still undervalues the company.

It said its leading position in emerging markets and strong growth opportunities put it in good stead to grow on its own.

Cadbury is now revising its performance targets for the next four years, with goals of 5-7% annual organic growth, improved margins of 16-18% by 2013 and double-digit growth in dividends per share from 2010 onwards.

It also expected to improve margins by 16 to 18% by 2013.

Cadbury chairman Roger Carr said shareholders would be better off if Cadbury rejected Kraft’s offer, which he branded a “steal”.

“Kraft is trying to buy Cadbury on the cheap to provide much needed growth to their unattractive low-growth conglomerate business model,” Carr said. “It is clear to all that Cadbury is a particularly attractive asset in the sector with iconic brands, a sharp category focus and an enviable geographic footprint.

“We believe our shareholders should have the opportunity to reap the full rewards of the investment that has already been made in creating a platform for future improved revenue growth, enhanced profitability and high cash returns.”

It is rumoured other buyers have expressed interest in Cadbury – namely, US company Hershey and Italian confectionery giant Ferrero, but Cadbury has not confirmed offers as yet.