DealZone

Sweet nothings for Cadbury

November 18, 2009

So far, Cadbury’s hope that Italy’s Ferrero and U.S.-based Hershey will make a counter-bid for the chocolate company look like a pipedream. Cadbury’s stock has ticked up but is still pretty much where it has been since Kraft’s hostile $16.8 offer hit the market. Nobody appears to be buying the idea that a white-chocolate knight will come up with a bid to seriously rival Kraft’s.

The chance of a joint Ferrero-Hershey bid may be slim. Questions about funding commitments and investment restrictions set on Hershey by its charitable trust ownership structure make any deal involving the maker of chocolate kisses a tough sell.

And market sources say that if they were successful, a Ferrero-Hershey tie-up would likely lead to a breakup of Cadbury along geographic lines.

Post Your Comment

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/