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NEW YORK -- Approximately 1.5 percent of Cadbury Plc's shareholders have accepted Kraft Inc.'s $17.5 billion hostile offer as of the first closing date, Jan. 5.
Kraft urged Cadbury securityholders who have not yet accepted the offer to do so by 1 p.m. London time, Feb. 2, 2010.
Meanwhile, Bloomberg News reported The Hershey Co. executives and board members are split on whether to make a bid for Cadbury, and haven't arranged financing for an offer.
The Hershey board met Jan. 4, without reaching a decision, according to people close to the matter who spoke to Bloomberg News. Some members of Hershey's controlling trust, led by former Pennsylvania Attorney General LeRoy Zimmerman, have been advocating a deal, while CEO David West is among those concerned about the debt a purchase would entail, according to the report.
Cadbury is twice the size of Hershey. Some speculate to fund a purchase Hershey may pledge to sell the U.S. rights to the Kit Kat and Rolo brands or Cadbury operations in some countries, according to the Bloomberg News report.
"A bid does make a lot of sense but they would have to incur some debt," Roy Behren, who helps manage $2.4 billion at Westchester Capital Management in Valhalla, N.Y., told Bloomberg News. "I don't know to what extent they're willing to risk the investment grade credit rating."
Cadbury's Chairman Roger Carr in December said the company told Hershey "very clearly what the rules of the game are" and said Cadbury would be willing to sit down and talk with Hershey if the U.S. company develops a "compelling offer" that is fully financed.
Kraft Stands By Bid for Cadbury