- The Washington Times - Saturday, December 5, 2009

PORTLAND, Ore. | Kraft Foods Inc. took its $16.3 billion hostile-takeover offer for Cadbury PLC straight to shareholders of the British candy company on Friday.

The deal is nearly unchanged from an earlier offer that was rejected by Cadbury. But by putting it directly in shareholder hands, Kraft starts the clock on a series of regulatory deadlines to get the majority support it needs and may flush out rival bids.

Kraft announced in September that it proposed a takeover of Cadbury and formally issued the bid in November. Cadbury immediately rejected the offer, saying it undervalued the company.

Cadbury, the maker of Dairy Milk chocolate and Dentyne gum, declined to comment on the offer but has been clear about its disinterest at the offered price. Under British regulations, Cadbury has two weeks to give a formal response to the offer before shareholders.

Retaining the original offer gives Kraft, the maker of Oreo cookies, Nabisco crackers and its namesake cheese, some wiggle room to increase its bid should a rival suitor emerge.

Kraft wants to get the majority shareholder votes by Jan. 5, but can take until February to complete the process under regulations.

Hershey Co. of the U.S. and Italy’s Ferrero International SA have said they are considering an offer. Hershey would not comment Friday on the possibility of a competing offer.

Analysts have also suggested that Nestle SA may be interested, although the Swiss company has made no comment.

Cadbury is an attractive acquisition for any of the companies. It is one of the world’s largest confectionery companies and has strong international reach, with a key presence in emerging markets.

Company leaders said they would consider any bids that adequately value Cadbury, but have also expressed a strong desire for the company to remain independent. The potential sale of the 195-year-old brand worries some Britons, and at least one member of Cadbury’s founding family has spoken out against it.

c Jane Wardell contributed to this report.

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