UPDATE:Kraft CEO: Right Time To Grow, With Cadbury Or Without
October 07 2009 - 4:12PM
Dow Jones News
Kraft Foods Inc. (KFT) Chief Executive Irene Rosenfeld gave no
indication Wednesday of her next move on Cadbury PLC (CBY), but
emphasized that the food giant is poised for growth: with or
without Cadbury.
Speaking at the World Business Forum in New York, she said now
is the right time for Kraft to accelerate its growth, with Cadbury
or on a standalone basis.
Kraft last month unveiled a proposal to take over Cadbury, but
has yet to make a formal offer. Cadbury rejected Kraft's initial
approach. Kraft now has until Nov. 9 to make a formal offer for the
U.K. company. Kraft has widely been expected to raise its initial
bid of 745 pence a share, although the absence of any counter bids
would likely strengthen its bargaining position.
Kraft's shares have dropped since news of its takeover bid,
leaving Rosenfeld with the task of reassuring her own shareholders
and of convincing Cadbury holders of the value of her company's
cash and stock bid.
Rosenfeld Wednesday made the case that Kraft has substantially
improved its growth prospects on her watch by bolstering its
brands, cutting costs and improving its management structure. The
company is set to meet its long-term targets for 7% to 9% earnings
growth, she said.
Kraft hasn't made a formal bid so far, and it has the option of
walking away, seeking a friendly deal or turning hostile. With
Cadbury having rejected Kraft's initial approach, the final outcome
of the deal remains uncertain and Kraft has sought to emphasize
that it is well positioned, even as a standalone firm.
In recent trading, Kraft shares were down 0.1% at $26.06, while
Cadbury was off 0.3% at $50.61.
-By Anjali Cordeiro, Dow Jones Newswires; 212-416-2200;
anjali.cordeiro@dowjones.com