Irene presses the snooze button on Cadbury

November 9, 2009

Perhaps Irene Rosenfeld and her colleagues had had such an exhausting weekend agonising over what to do that they were unable to set their Monday alarms earlier than 8am New York time. Thus it wasn’t until lunchtime in London that her colleagues at Kraft Foods set off their post-bonfire-night damp squib, formally committing the company to the same indicative terms it first offered two months ago.

The move starts the takeover clock, but the terms offer precious little chance of winning, while the banks will now need to be paid their commitment fees, and the advisers will be rubbing their hands.

So far, Kraft has been anything but krafty. Despite having the advantage of surprise, the timing of the approach looks poor. A savvier operator than Rosenfeld would have produced some fizzy figures to support the share price, rather than last week’s rather curled-up cheese slices. Cadbury, on the other hand, has engineered some decent results, and has twitched its guidance up for the near future. It took only minutes for the board to roll out its preprepared “derisory” startement of rejection. 

In short, the first two months of what promises to be a long campaign have been wasted. Kraft may have demonstrated that it’s the only bidder in town, but surely bid-’em-up Bruce would have played this particular hand rather better had he lived. He’d certainly have got up earlier.

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[…] Kraft’s offer is actually worth less than an initial informal approach because its stock has fallen in the meantime. Monday’s move certainly hasn’t impressed Reuters columnist Neil Collins, who says Kraft CEO Irene Rosenfeld has “pressed the snooze button”. […]

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