US-based confectioner Hershey threw in the towel yesterday and said that it had no plans to make a counter-bid for Cadbury after its bigger rival Kraft Foods revised and raised its offer for the British confectioner.
In a statement yesterday, the Pennsylvania-based confectioner said, ''The Hershey Company announces that it does not intend to make an offer for Cadbury'' after it found that the revised bid by Kraft of 840 pence per share, and a 10 pence dividend, was too high for it to match.
Analysts believed that Hershey may come up with a counter offer as it had evinced interest in Cadbury last November in a move to expand beyond its home market (See: Hershey reportedly mulling $17 billion solo bid for Cadbury).
A merger with Cadbury would have helped Hershey expand into developing markets like India and Russia.
This week, after four months of putting a valiant struggle to thwart the world's second largest food and beverage company Kraft Foods $16.7-billion hostile takeover, the iconic 186-year old London-based Cadbury finally gave up its struggle to remain independent after Kraft raised its takeover offer to $19.6 billion. (See: Cadbury finally falls to Kraft's sweetened bid)
The Hershey board of directors voted unanimously against making a counter offer late Wednesday night and made the announcement the following day since it was required to either announce a firm intention to make an offer or that it does not intend to make an offer for Cadbury under the UK Takeover Panel rules by 7 am on 25 January.