Cadbury once again to reject Kraft’s “unappealing” offer

London-based confectioner, Cadbury is readying itself to post its defence within two week after Kraft, the largest food and beverage company in the US sent its $16.4 billion hostile offer to Cadbury shareholders (See: Kraft goes hostile with original offer) 

Smarting from the the hostile bid, Cadbury, the maker of Cadbury chocolate and Trident gums is expected to once again reject Kraft's offer as "materially" undervaluing and will not change its view that it would be far better off as a stand-alone company.

Northfield, Illinois-based Kraft with 2008 revenue of over $42 billion had made a $16.7-billion (£10.2 billion) acquisition offer to Cadbury in September, which was rejected by the board of Cadbury. (See: Cadbury rejects Kraft Foods' $16.7 billion merger offer)

Cadbury had justified its rejection of the unsolicited takeover offer from Kraft saying that its rival's low-growth, conglomerate business model was ''unappealing'' as it differs from Cadbury's strategy of being a pure play confectionery company.

Commenting on the publication of the offer documentation, the chairman and CEO of Kraft Foods, Irene Rosenfeld, said, "We remain confident that the unique combination of Kraft Foods and Cadbury would create a significant growth opportunity for both businesses. That's why we believe this Offer is in the best interest of both companies' shareholders.''

''Our Offer is fully financed, represents a substantial premium to Cadbury's unaffected share price and provides both immediate value certainty and meaningful longer-term upside potential," she added. (See: Kraft confirms $9-billion loan for Cadbury acquisition)