Crunchie time

7 January 2010 By Chris Hughes

It would be nice to persuade Hershey to come in with an offer that trumped Kraft’s hostile bid. But that’s not going to be easy. With Kraft’s own offer closing in on Cadbury’s share price, the best the UK confectioner may be able to do is repromote its solo prospects.

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Members of Cadbury's board have been talking with counterparts at U.S. rival Hershey seeking a takeover offer to trump Kraft Foods' 10.5 billion pounds bid for the UK confectioner, sources told Reuters.

Cadbury said it would it issue its second response to Kraft's offer in two parts on Jan. 12 and Jan. 14, the latter including a detailed review of its 2009 performance by business line.

The UK Takeover Panel gave special approval for the unorthodox twostage disclosure, as the extra information would not have been ready on Jan. 12, at which point Cadbury would have ordinarily been barred from providing material new information within an offer period.

Cadbury shares were up 0.13 percent at 774 pence in early trade on Jan. 7, against Kraft's cashandshares offer of 770p based on the U.S. food group's closing share price on Jan. 6.

The spread between Cadbury's share price and Kraft's offer has narrowed since Jan. 5, when Switzerland's Nestle ruled itself out of bidding for the UK company, and Warren Buffett, a 9.4 percent shareholder in Kraft, attacked the structure of the offer.

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