No thank you, said Cadbury, maker of fine chocolates.They do not wish to be bought up by a company best known as a maker of low-priced, processed cheese food.
Kraft has made a generous offer, given that Cadbury's shares closed on Friday at 569p while Kraft is willing to pay 745p. It suggests that Kraft is keen to own Cadbury and believes that there's enough value in the company to warrant such an offer.
Cadbury is an iconic brand in England and Ireland, a step above M&M/Mars which has gone down a tick since it purchased the Wrigley gum brand. Kraft would like to expand into the European market, and it already owns Toblerone.
Yes, well. Does anyone think Toblerone when they think of a luscious, rich chocolate bar? Not if you're watching your pennies and as far as your splurge can extend is to that Dairy Milk bar. It's not considered an exotic import in Bristol or Birmingham, where it's made.
Kraft thinks that all Cadbury's needs is a little economy of scale to break out of its niche market. That would be where Kraft comes in. That would be where the employees of Cadbury get concerned.
At the moment, Cadbury is planning to shutter their Bristol facility, but if Kraft could keep the plant open, there'd be more support for the buy-out. Cadbury management is not entirely sure that what Kraft has in mind, given that it's a global behemoth that could move manufacturing anywhere in the world, would be of benefit to the Cadbury employees.
There's a certain amount of pride that goes into a well-known and much-loved chocolate. No one wants to see the name besmirched and associated with low-class items like boxed macaroni and cheese or Oreos.
It will be a hard sell, and Kraft will have to find out how much Cadbury pride is worth.
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