The Italian group, which is owned by the Ferrero family and sells the Nutella hazelnut spread and Kinder chocolates, informed its bank advisers at Mediobanca about its decision on Tuesday, The Wall Street Journal reported.
The offer, which would have competed with a hostile bid from US giant Kraft Foods, was "not in line with the family's strategy", a source close to the issue told The Wall Street Journal.
Ferrero dropped out because it was unable to come to an agreement with Hershey on how to divide Cadbury's assets, Italian financial daily Il Sole 24 Ore reported.
A bid would have also required the two companies to go deeply into debt to match Kraft's offer, media reported.
Ferrero and its bank, Mediobanca, refused to comment on the reports.
The Italian financial daily Il Sole 24 Ore reported on Tuesday that Ferrero had lined up €1.5 billion (US$2.2 billion) from Mediobanca and €3.0 billion from UniCredit to help finance its joint takeover.
Hershey planned to borrow another $7.0 billion (€4.8 billion) for the operation, Il Sole said.
Kraft's offer in cash and shares would be worth £10.5 billion (€11.7 billion, $16.9 billion), an offer which Cadbury dismissed again Tuesday as "derisory."
Source: AFP
Published courtesy of
