Case study: Kraft's hostile takeover of Cadbury

• http://www.wisegeek.com/what-is-a-hostile-takeover.htm
• https://www.cadbury.co.uk/
• http://www.theguardian.com/business/2010/jan/20/cadbury-kraft-takeover-fair-trade
• http://www.telegraph.co.uk/finance/newsbysector/epic/cbry/8531542/Kraft-acted-irresponsibly-in-Cadbury-takeover-say-MPs.html
• http://www.theguardian.com/business/2012/apr/04/kraft-cadbury-irene-rosenfeld-22m
• http://news.bbc.co.uk/2/hi/business/8468096.stm
• http://www.theguardian.com/business/2011/dec/06/kraft-axes-200-uk-jobs
• http://www.theguardian.com/business/2010/may/26/kraft-censured-over-cadbury-takeover-pledge
• http://www.ft.com/intl/cms/s/0/1cb06d30-332f-11e1-a51e-00144feabdc0.html#axzz3VLsboxws
• http://www.theguardian.com/business/2009/sep/13/cadbury-attacks-kraft-offer?INTCMP=SRCH
• http://www.theguardian.com/business/2010/feb/14/cadbury-kraft-business-select-committee?INTCMP=SRCH
• http://www.sweetsandsnackseurope.com/news/kraft-to-cut-200-jobs/
• https://en.wikipedia.org/wiki/Kraft_Foods
• https://en.wikipedia.org/wiki/Mondel%C4%93z_International#cite_note-27
• http://beta.tutor2u.net/business/blog/cadburys-law-should-uk-firms-be-protected-from-takeover
• http://www.telegraph.co.uk/finance/newsbysector/retailandconsumer/8471076/Was-Cadbury-a-sweet-deal-for-Kraft-investors.html

Company takeover

Kraft's hostile takeover of

II. Kraft's takeover of Cadbury

Outline

The course of the takeover

• In September 2009 Kraft's launched a £9.8 billion bid for Cadbury.

• Cadbury rejects the offer and launches defense campaign.

• Krafts sweetens the offer.

• In January 2010 Cadbury accepts a revised £11.5 billion offer.

I.Definition of a company takeover, different types

II. Overview of Kraft and Cadbury, the course of the takeover

III. Consequences and the ethical side of the takeover

http://www.salon.com/2010/01/20/kraft_cadbury_takeover_british_reaction/

http://trends-now.website/cadbury-logo-vector/

Cadbury products

• founded by John Cadbury in 1824 in Birmingham, England.

new merger plans

2015

Dairy milk

• mergers and demergers

Fudge

http://www.andlil.com/societe-kraft-foods-group-incorporated-140950.html

Wispa

• It is the second largest confectionery brand in the world after Wrigley's (owned by Mars since 2008)

Skippy

Twirl

etc.

Flake

• present in more than 50 countries

• started in 1916

Crunchie

Roses

• Total revenue - 11,346,002,000 £ (2011)
• Net income - 559,432,200 £ (2011)
• Number of employees - 71,657 (2008)

• second-largest confectionery, food and beverage conglomerate

http://www.hemingways.co.uk/

• more than 50 brands

(Mondelez int. + Kraft foods)

http://www.kraftfoodsgroup.com/home/index.aspx

https://www.cadbury.co.uk/the-story#bournville-the-factory-in-a-garden-is-born

Hostile takeover

Friendly takeover

hostile takeover

I.

2012: Split into

• risk for publicly traded companies

the target company does not approve of the buyout and fights against the acquisition.

a target company's management and board of directors agree to an acquisition by another company

https://en.wikipedia.org/wiki/Kraft_Foods

Merger

http://stemhorizons.org/index.php/company-profiles/item/67-mondelez-international/67-mondelez-international

• traumatic for the target company

Criticism of Kraft over Job losses

III. Consequences, Ethics, Issues

18.218 billion (2013)

2.715 billion (2013)

Total Revenue

Net income

35.3 billion (2013)

3.92 billion (2013)

legal consolidation of two companies into one entity

• lack of information -> risky for the acquirer company

2011 - 200 jobs cut at Bournville historic factory despite the no-cuts pledge.

http://www.advisor.ca/tax/estate-planning/avoid-a-hostile-takeover-86736

Public Response

Company takeover

Kraft was called before MPs to defend its dirty play during the takeover battle

Fears over the future of Cadbury's values

http://www.carsuk.net/porsche-finally-becomes-a-vw-company/

Cadbury Cocoa Partnership

2010 - eventual closure of the Somerdale plant near Bristol, 400 jobs lost.

Examples of takeovers

one company takes over another and completely establishes itself as the new owner

£45 billion investment into cocoa farms in Gahna, India, Indonesia, the Caribbean.

Porsche by Volkswagen (2012)

Irene Rosenfeld received 22 million dollars for hitting targets tied to cutting costs at Cadbury

2009 - Cadbury launched Fairtrade Dairy milk chocolate bars

The Body Shop by L'Oréal (2006)

http://avanguard.blogspot.fr/2006/03/loral-to-take-over-body-shop-ft.html

http://brandnoise.typepad.com/brand_noise/2005/01/pggillette_figh.html

Gilette by Procter & Gamble (2005)

Kraft was seen as being

hostile to the

Fairtrade Foundation

Ben&Jerry's by Unilever (2001)

• Public outrage

http://becuo.com/ben-and-jerrys-background

http://pixshark.com/unilever-ben-and-jerrys.htm

• Labour party proposes the so-called Cadbury's law

Stonyfield by Danone (2001)

http://www.sweetsandsnackseurope.com/news/criticism-of-kraft%E2%80%99s-conduct-since-cadbury-takeover/

http://www.appforhealth.com/tag/appetite-for-health-giveaway/

http://www.danone.ru

a long sequence of major takeovers of British companies by overseas firms

• concerns over lost jobs, reduced investment and closures.

Sources

as a result

Kraft's battered image in the UK

http://news.bbc.co.uk/2/hi/business/8468096.stm

THANK YOU

-> campaign to rehabilitate its image

Chubukova Olga

http://store.ukgourmet.us/cadamiwior.html