US giant Kraft Foods has made a £10.2bn (€11.5bn) takeover offer for British confectionery group Cadbury, it was revealed today.
Kraft – the firm behind brands including Maxwell House, Oreos and Jacobs – said Cadbury had already rejected its initial advances.
But Cadbury’s suitor said it was “committed to working toward a recommended transaction” and hopes to continue talks with the maker of Dairy Milk chocolate.
Kraft said it had made a potential cash-and-shares bid worth 745p a share to the board of Cadbury. Shares closed at 569p on Friday evening.
A merger of the two companies would create a “global powerhouse” in food and confectionery, with annual sales of around $50bn (€35bn), according to Kraft.
The group also sought to give assurance that a deal between the two would be beneficial to Cadbury staff.
It said it hoped to keep open Cadbury’s Somerdale facility near Bristol in England, which is currently scheduled to close, while also investing in the firm’s Bournville factory near Birmingham.
Kraft is one of the world’s biggest food firms, with brands well-known internationally, including Dairylea, Toblerone, Terry’s Chocolate Orange and Kenco coffee.
It has a UK and Ireland operation, with its headquarters in Cheltenham, England, for more than 25 years.
The group also has a further regional office in Kew, west London.
Irene Rosenfeld, chairman and chief executive of Kraft Foods, said: “This proposed combination is about growth. 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.
“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.
“Cadbury’s brands, which are highly complementary to our portfolio, would benefit from Kraft Foods’ global scope and scale and array of proprietary technologies and processes.”