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| Kraft in £10.2bn move for Cadbury | |
| (20 minutes later) | |
| US food giant Kraft has proposed buying confectionary giant Cadbury in a £10.2bn ($16.7bn) move. | US food giant Kraft has proposed buying confectionary giant Cadbury in a £10.2bn ($16.7bn) move. |
| Kraft said that the purchase of the maker of Dairy Milk would protect jobs in the UK - including saving a factory earmarked for closure. | Kraft said that the purchase of the maker of Dairy Milk would protect jobs in the UK - including saving a factory earmarked for closure. |
| The board of Cadbury has rejected the approach, Kraft said. | The board of Cadbury has rejected the approach, Kraft said. |
| Kraft said it wanted to build on Cadbury's brands and that a deal would create "a global powerhouse in snacks, confectionary and quick meals." | Kraft said it wanted to build on Cadbury's brands and that a deal would create "a global powerhouse in snacks, confectionary and quick meals." |
| Distribution savings | |
| Cadbury also owns the Green & Black's chocolate brand and Halls lozenges, Trident and Dentyne gum brands, and liquorice allsorts maker Bassett's. It span off its drinks division as a separate business last year. | Cadbury also owns the Green & Black's chocolate brand and Halls lozenges, Trident and Dentyne gum brands, and liquorice allsorts maker Bassett's. It span off its drinks division as a separate business last year. |
| Kraft's brands include Kenco coffee, Oreo biscuits, Terry's Chocolate Orange and Toblerone as well as producing cheeses and ready meals, | |
| Such a deal would allow up to $625m a year to be saved in distribution, marketing and product development costs, Kraft said. | |
| It added that Cadbury's brands were "highly complementary" to its portfolio and "would benefit from Kraft Foods' global scope and scale and array of proprietary technologies and processes". | |
| 'Iconic brands' | |
| "As we have done, Cadbury has built wonderful brands by focusing on quality, innovation and marketing, but we believe the next stage in Cadbury's development will be challenging, given the increased importance of scale in the industry." said Kraft chairman Irene Rosenfeld. | |
| "We are eager to build upon Cadbury's iconic brands and strong British heritage through increased investment and innovation. We have great respect and admiration for Cadbury, its employees, its leadership and its proud heritage." | |
| Industry analysts have been speculating that there could be consolidation in the food sector. | |
| Kraft said its possible offer - based on paying 745 pence for every Cadbury's share - was a 31% premium to its closing price last week and 42% more than the firm's shares were worth in early July, when speculation about possible deals in the sector intensified. |