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Case study: Kraft's hostile takeover of Cadbury
Transcript of Case study: Kraft's hostile takeover of Cadbury
II. Kraft's takeover of Cadbury
The course of the takeover
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
a target company's management and board of directors agree to an acquisition by another company
one company takes over another and completely establishes itself as the new owner
legal consolidation of two companies into one entity
the target company does not approve of the buyout and fights against the acquisition.
risk for publicly traded companies
lack of information -> risky for the acquirer company
traumatic for the target company
Examples of takeovers
Porsche by Volkswagen (2012)
The Body Shop by L'Oréal (2006)
Gilette by Procter & Gamble (2005)
Ben&Jerry's by Unilever (2001)
Stonyfield by Danone (2001)
founded by John Cadbury in 1824 in Birmingham, England.
It is the second largest confectionery brand in the world after Wrigley's (owned by Mars since 2008)
Total revenue - 11,346,002,000 £ (2011)
Net income - 559,432,200 £ (2011)
Number of employees - 71,657 (2008)
mergers and demergers
present in more than 50 countries
started in 1916
second-largest confectionery, food and beverage conglomerate
more than 50 brands
2012: Split into
18.218 billion (2013)
2.715 billion (2013)
35.3 billion (2013)
3.92 billion (2013)
new merger plans
In September 2009 Kraft's launched a
bid for Cadbury.
Cadbury rejects the offer and launches defense campaign.
In January 2010 Cadbury accepts a revised
Krafts sweetens the offer.
III. Consequences, Ethics, Issues
Criticism of Kraft over Job losses
Cadbury Cocoa Partnership
2011 - 200 jobs cut at Bournville historic factory despite the no-cuts pledge.
2010 - eventual closure of the Somerdale plant near Bristol, 400 jobs lost.
Irene Rosenfeld received 22 million dollars for hitting targets tied to cutting costs at Cadbury
(Mondelez int. + Kraft foods)
Fears over the future of Cadbury's values
2009 - Cadbury launched Fairtrade Dairy milk chocolate bars
Kraft was seen as being
hostile to the
as a result
Kraft's battered image in the UK
-> campaign to rehabilitate its image
Labour party proposes the so-called Cadbury's law
concerns over lost jobs, reduced investment and closures.
a long sequence of major takeovers of British companies by overseas firms
Kraft was called before MPs to defend its dirty play during the takeover battle
£45 billion investment into cocoa farms in Gahna, India, Indonesia, the Caribbean.