Kraft poised to increase Cadbury offer

US food giant Kraft stepped up its pursuit of UK rival Cadbury today by pledging to sweeten the cash part of its £10bn (€11.14bn) takeover offer.

Kraft is selling its North American frozen pizza business to Nestle for US$3.7bn (€2.5bn) in order to fund the revised proposal.

Meanwhile, Nestle confirmed it has no intention of making an offer for the UK firm. Speculation surrounding the KitKat maker’s acquisition plans were fuelled yesterday when it raised more than £17bn (€18.9bn) from the sale of its 52% stake in eye care group Alcon.

Kraft said it will give further details of its alternative takeover proposal by January 19, the last day under takeover rules that it is allowed to amend its offer.

The US firm also said it had extended today’s deadline for Cadbury shareholders to accept its takeover offer to lunchtime on February 2.

Kraft’s original offer was for £3 (€3.34) per Cadbury share plus 0.26 new Kraft shares, although it now plans to increase the cash element by 60p a share in order to meet the concerns of Cadbury shareholders.