Kraft seals Cadbury deal amid growing job fears

Shareholders representing almost three quarters of Cadbury supported the deal, following the agreement of the firm's board last month to a sweetened offer from Kraft.

The improved cash-and-shares bid worth £11.9 billion ($19.0 billion, €13.6 billion), or 850 pence per share, ended a bruising, months-long takeover battle.

The shareholders' backing Tuesday will allow Kraft, the world's second-biggest food company, to gobble up Cadbury, whose colourful history as an independent British company dates back to 1824.

The takeover also makes Kraft one of the biggest global players in chocolate and confectionery, giving it major brands like Creme Egg and Trident chewing gum to go with Kraft's Toblerone, Milka, Suchard and Cote d'Or.

"The combination of Kraft Foods and Cadbury creates a global powerhouse in snacks, confectionery and quick meals," said chief executive Irene Rosenfeld, credited with masterminding the takeover.

Job and management uncertainty

But fears were mounting for the future of around 5,600 staff at eight Cadbury factories in Britain and Ireland.

After a meeting late Tuesday with Rosenfeld, British business minister Peter Mandelson said he was "disappointed" that she had failed to commit to running Cadbury's global operations from Britain.

"I was disappointed that she was unable to confirm that Cadbury's confectionery brands will continue to be managed and operated globally out of Britain," said Mandelson in comments to broadcaster the BBC.

He vowed to seek "much harder, more specific commitments in the next three to six months" from the American giant.

The minister added, however, it was encouraging Rosenfeld said she expected Britain to be a net gainer in manufacturing output and employment.

For her part, Rosenfeld sought to allay concerns about possible job cuts despite failing to provide the guarantees demanded by the government and unions.

"As we have said from the outset, our interest is in growing Cadbury and investing in its great brands and people," said Rosenfeld after meeting Mandelson.

"That will be good for the company, good for (Britain) and good for British manufacturing jobs."

Call for guarantees

Jack Dromey, deputy general secretary of Unite, Britain's biggest trade union, earlier in the day called for "cast-iron guarantees" over the future of Cadbury workers.

"This is a sad day for Britain. A world-class sector of British excellence is being taken over by a debt-laden US company," Dromey said at a demonstration against the Kraft takeover.

One protester at the central London demonstration was dressed in a gorilla outfit and banging a drum, copying a popular British television advert for Cadbury's Dairy Milk chocolate.

"Unconditional" agreement

Earlier Tuesday, Kraft announced in a statement that Cadbury's investors holding 71.73% of the group had accepted the offer.

The US giant also declared its bid "unconditional", meaning all of its takeover conditions had been met.

Kraft added that it would seek to cancel Cadbury's listing on the London Stock Exchange after it reaches the 75% level.

When Kraft reaches 90% support it will be able to automatically snap up any remaining stock.

Cadbury, which began as a small grocer's shop in Birmingham, central England, in 1824, has grown into a global operation spanning 60 countries with 45,000 employees.

Kraft, which traces its history to 1903 when JL Kraft started selling cheese from a horse-drawn wagon, also makes Oreo biscuits and Kraft Singles cheese slices.

Source: AFP