LONDON: British candy maker Cadbury PLC on Tuesday accepted Kraft’s improved takeover offer worth $19.5 billion, potentially ending a monthslong corporate battle to create the world’s largest maker of chocolate and sweets.
The US food conglomerate said the board of Cadbury, maker of Creme Eggs and Dentyne gum, had unanimously endorsed the offer worth 840 pence per share, or 11.9 billion pounds in total. Cadbury shareholders will also get a 10 pence dividend previously promised by Cadbury.
The revised bid is for 500 pence cash and 0.1874 new Kraft shares for each Cadbury share, still somewhat less than some analysts believed the company is worth but 50 percent higher than Cadbury’s market value before Kraft went public with its approach.
Kraft Foods Inc.’s previous offer of 10.5 billion pounds ($17.1 billion) valued Cadbury at about 770 pence, but was dismissed by the British company’s management as “derisory.” Kraft still has to persuade a majority of Cadbury shareholders to accept the deal. The combined companies would be the world leader in chocolate and sweets, Kraft said, and No. 2 globally in the high-growth gum market. But some in Britain are disgruntled at the prospect of a historic brand losing its independence.
Cadbury traces its roots to the grocery store opened in 1824 by John Cadbury in Birmingham.