{"id":141131,"date":"2010-01-05T13:37:00","date_gmt":"2010-01-05T18:37:00","guid":{"rendered":"tag:blogger.com,1999:blog-3087194156628161158.post-923146679976862030"},"modified":"2010-01-05T13:45:16","modified_gmt":"2010-01-05T18:45:16","slug":"financial-times-video-buffett-warns-kraft-on-bid-for-cadbury","status":"publish","type":"post","link":"https:\/\/mereja.media\/index\/141131","title":{"rendered":"FINANCIAL TIMES VIDEO: Buffett warns Kraft on bid for Cadbury"},"content":{"rendered":"<p><!-- AddThis Button BEGIN -->By Adam Jones in London, Haig Simonian in Zurich and Alan Rappeport in New York <\/p>\n<p>Published: January 5 2010 08:21 | Last updated: January 5 2010 15:51<\/p>\n<p><script type=\"text\/javascript\" language=\"javascript\"> function floatContent(){var paraNum = \"6\" paraNum = paraNum - 1;var tb = document.getElementById('floating-con');var nl = document.getElementById('floating-target');if(tb.getElementsByTagName(\"div\").length> 0){if (nl.getElementsByTagName(\"p\").length>= paraNum){nl.insertBefore(tb,nl.getElementsByTagName(\"p\")[paraNum]);}else {if (nl.getElementsByTagName(\"p\").length == 3){nl.insertBefore(tb,nl.getElementsByTagName(\"p\")[2]);}else {nl.insertBefore(tb,nl.getElementsByTagName(\"p\")[0]);}}}}<\/script><\/p>\n<p><b><a symbol=\"us:KFT\" href=\"http:\/\/markets.ft.com\/tearsheets\/performance.asp?s=us:KFT\">Kraft Foods<\/a><\/b> has suffered an unexpected setback in its pursuit of <b><a symbol=\"uk:CBRY\" href=\"http:\/\/markets.ft.com\/tearsheets\/performance.asp?s=uk:CBRY\">Cadbury<\/a><\/b> after encountering opposition from <b><a symbol=\"us:BRK.A\" href=\"http:\/\/markets.ft.com\/tearsheets\/performance.asp?s=us:BRK.A\">Berkshire Hathaway<\/a><\/b>, Warren Buffett\u2019s investment vehicle.<\/p>\n<p>Berkshire, which has a 9.4 per cent stake in Kraft, announced on Tuesday that it had voted \u201cno\u201d to a proposal to authorise the issue of up to 370m Kraft shares to fund its \u00a310.7bn hostile bid for the UK-headquartered confectioner.<\/p>\n<p>In an unusually-public expression of misgiving, Berkshire claimed that the measure would give the US-based food multinational a blank cheque to change its offer \u201cin any way it wishes\u201d. <\/p>\n<div style=\"margin: 12px; text-align: center;\" id=\"flashParentHTML\"><embed type=\"application\/x-shockwave-flash\" src=\"http:\/\/financialtimes.a.mms.mavenapps.net\/mms\/rt\/1\/site\/financialtimes-pub01-live\/current\/mp_ukdv\/ftmini\/client\/ftmini.swf\" style=\"\" id=\"mavenFlashPlayer\" bgcolor=\"#000000\" quality=\"high\" name=\"mavenFlashPlayer\" play=\"false\" scale=\"noscale\" salign=\"LT\" scriptaccess=\"always\" allowscriptaccess=\"always\" menu=\"true\" allowfullscreen=\"true\" flashvars=\"nclick_check=1&amp;GEO_CODE=NZL&amp;referralObject=13121927&amp;CHANNEL=UK Daily View&amp;CHANNEL_URL=http:\/\/www.ft.com\/ukdailyview&amp;playerId=mp_ukdv&amp;playlistId=5a563cff5208d08584158db91936038d50488655&amp;allowDomains=www.ft.com\" height=\"274\" width=\"272\"><\/embed><\/div>\n<p><script type=\"text\/javascript\" src=\"http:\/\/financialtimes.a.mms.mavenapps.net\/mms\/rt\/1\/site\/financialtimes-pub01-live\/current\/mp_ukdv.js\" id=\"mp_ukdv\"> \/\/the JS file that is included is called <playername>.js - the id value is the playername again <\/script><script type=\"text\/javascript\" id=\"settings\" src=\"http:\/\/financialtimes.a.mms.mavenapps.net\/mms\/rt\/1\/site\/financialtimes-pub01-live\/current\/mp_ukdv\/ftmini\/client\/settings.js\"><\/script><script type=\"text\/javascript\" id=\"mavenplayer\" src=\"http:\/\/financialtimes.a.mms.mavenapps.net\/mms\/rt\/1\/site\/financialtimes-pub01-live\/current\/mp_ukdv\/common4.1\/client\/mavenplayer.js\"><\/script><script type=\"text\/javascript\" id=\"mpExtensions\" src=\"http:\/\/financialtimes.a.mms.mavenapps.net\/mms\/rt\/1\/site\/financialtimes-pub01-live\/current\/mp_ukdv\/ftmini\/client\/mpExtensions.js\"><\/script><script type=\"text\/javascript\"> var video=\"yes\";function loadMavenPlayer() {var geoAYSC = document.cookie.match(\/AYSC=([^;]*)\/) ? RegExp.$1 : \"\";var geoCountry = geoAYSC.match(\/_14([^_]*)\/) ? RegExp.$1 : null;var mp = new MavenPlayer('mp_ukdv'); \/\/again - the same playername as used for the .js as well as the id mp.setParameter('checkSystemId', 'systemRequirementsHTML');mp.setQueryParamsAsVariables(false);\/\/this is how you pass along flashVars: you simply call setVariable on mp - the first param is the flashVar name, the second is the actual value mp.setVariable(\"GEO_CODE\", geoCountry?geoCountry:\"undefined\");mp.setVariable(\"referralObject\",\"13121927\");mp.setVariable(\"CHANNEL\", \"UK Daily View\") mp.setVariable(\"CHANNEL_URL\", \"http:\/\/www.ft.com\/ukdailyview\") \/\/once all the variables are prompt the script to write out the object tag mp.write('flashParentHTML');}loadMavenPlayer();<\/script><\/p>\n<p>\u201cTo state the matter simply, a shareholder voting \u2018yes\u2019 today is authorising a huge transaction without knowing its cost or the means of payment,\u201d it said in a <a class=\"bodystrong\"  title=\"Berkshire statement\" href=\"http:\/\/everythingwarrenbuffett.blogspot.com\/2010\/01\/berkshire-hathaway-news-release-from.html\">statement<\/a>.<\/p>\n<p>But even though Berkshire described Kraft stock as an expensive form of bid currency, it held out the possibility of withdrawing its opposition if it gauged that the final offer did not destroy shareholder value.<\/p>\n<p>Berkshire\u2019s intervention came just hours after Kraft announced that it had increased the cash element of its bid for Cadbury after agreeing to sell its North American frozen pizza business to <b><a symbol=\"ch:NESN\" href=\"http:\/\/markets.ft.com\/tearsheets\/performance.asp?s=ch:NESN\">Nestl\u00e9<\/a><\/b> for $3.7bn.<\/p>\n<p>At the same time, Nestl\u00e9 declared that it would not make or participate in a rival offer for the British multinational, removing one potential source of competition to the Kraft bid, whose overall value remained unchanged.<\/p>\n<p>Kraft, the maker of Oreo cookies, Philadelphia cream cheese and Milka chocolate, had originally offered 300p plus 0.2589 Kraft shares for each Cadbury share.<\/p>\n<p>Using the proceeds of the frozen pizza business sale, Kraft said it would offer Cadbury shareholders the option of receiving an extra 60p per share in cash instead of some of the Kraft shares. <\/p>\n<p>Kraft argued the move to increase the cash element of its offer was in response to requests from Cadbury investors.<\/p>\n<p>It also said that it reflected pressure from Kraft shareholders to \u201cbe more sparing\u201d with its own stock \u2013 a statement that gained added resonance with Berkshire\u2019s subsequent intervention.<\/p>\n<p>Cadbury\u2019s response to the Kraft move was dismissive. \u201cKraft has once again missed the point. Despite this tinkering, the Kraft offer remains unchanged and derisory with less than half the consideration in cash,\u201d it said.<\/p>\n<p><img decoding=\"async\" alt=\"\" src=\"https:\/\/markets.ft.com\/chart\/livechart.asp?pagearg=B64ENCeyJjaGFydFR5cGUiOiJlIiwiY2hhcnRTaXplIjoibGFyZ2VDaGFydCIsImNoYXJ0V2lkdGgiOiIyNzIiLCJjaGFydEhlaWdodCI6IjE5MyIsImNoYXJ0SW5wdXRzIjp7ImNoYXJ0U3ltYm9scyI6WyI3MTA1NiIsIjE3NzEyNCJdLCJjaGFydExhYmVscyI6WyJDQlJZOkxTRSIsIktGVDpOWVEiXSwiY2hhcnRTdHlsZSI6IkxpbmUiLCJkdXJhdGlvbiI6IjE4MCIsInByaW1hcnlMYWJlbCI6IkNhZGJ1cnkiLCJzZWNvbmRhcnlMYWJlbCI6IktyYWZ0IiwiY2hhcnRUaW1lZnJhbWUiOiIxODAiLCJmb3JtYXRPdXRwdXQiOiJHSUYifSwib3V0cHV0Rm9ybWF0IjoidXBkYXRlIiwiaXNNb2JpbGUiOmZhbHNlfQ==\" align=\"left\" \/>Shares in Cadbury were trading 3.5 per cent lower at 776\u00bdp in late afternoon trading, still well above the 756p offer price. Kraft shares were trading 3 per cent higher at $28.25 in early US trading.<\/p>\n<p>Full details of the <a class=\"bodystrong\"  title=\"Kraft statement\" href=\"http:\/\/www.londonstockexchange.com\/exchange\/prices-and-news\/news\/market-news\/market-news-detail.html?announcementId=10329986\">revised offer from Kraft<\/a> have not yet been announced but will be published on or before January 19, the last date upon which Kraft can amend the terms of its bid, assuming another party does not trump its offer.<\/p>\n<p><b><a symbol=\"us:HSY\" href=\"http:\/\/markets.ft.com\/tearsheets\/performance.asp?s=us:HSY\">Hershey<\/a><\/b>, the US chocolate maker, and Ferrero International of Italy have both said that they were <a class=\"bodystrong\"  title=\"Financial Times - Rival groups weigh up Cadbury counter-bid\" href=\"http:\/\/www.ft.com\/cms\/s\/0\/95cf502c-d4aa-11de-a935-00144feabdc0.html\">considering whether or not to enter the bidding<\/a> for Cadbury.<\/p>\n<p>Nestl\u00e9 had until Tuesday declined to comment on its intentions, but analysts had speculated that the Swiss multinational could have participated in some form of counterbid for Cadbury &#8211; possibly in conjunction with Hershey.<\/p>\n<p>Such speculation was aided by <a class=\"bodystrong\"  title=\"Financial Times - Novartis seeks to complete Alcon buy-out\" href=\"http:\/\/www.ft.com\/cms\/s\/0\/c1e40c0c-f999-11de-8085-00144feab49a.html\">Monday\u2019s announcement by Nestl\u00e9<\/a> that it would receive more than $28bn for the second tranche of its shares in Alcon, the US eyecare company being sold to Novartis, the Swiss pharmaceuticals group.<\/p>\n<p>However, its <a class=\"bodystrong\"  title=\"Nestl\u00e9 statement\" href=\"http:\/\/www.londonstockexchange.com\/exchange\/prices-and-news\/news\/market-news\/market-news-detail.html?announcementId=10330083\">statement on Tuesday<\/a> said: \u201cAfter discussions with the UK Takeover Panel regarding the potential for further speculation&#8230; Nestl\u00e9 confirms that it does not intend to make, or participate in, a formal offer for Cadbury.\u201d <\/p>\n<p>Martin Deboo, an analyst at Investec Securities, said this removed the possibility of Nestl\u00e9 aiding Hershey in a bid for Cadbury. \u201cTheir [Hershey\u2019s] most obvious friend has left the playing field,\u201d said Mr Deboo.<\/p>\n<p>However, he added that the extra cash element did not \u201cfundamentally change the smell of Kraft\u2019s offer\u201d.<\/p>\n<p>Nestl\u00e9 said that buying Kraft\u2019s North American frozen pizza business would significantly boost its strategy of growing in premium convenience foods. <\/p>\n<p><i>Additional reporting by Jenny Wiggins<br \/><\/i><\/p>\n<p><a name=\"comments\"><span style=\"font-weight: bold;\">Share Investor Links<\/span><\/a><a name=\"comments\"><\/a><\/p>\n<p><a href=\"http:\/\/www.shareinvestorblog.com\/\">Share Investor Blog<\/a> &#8211; 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Berkshire, which has a 9.4 per [&hellip;]<\/p>\n","protected":false},"author":833,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[],"class_list":["post-141131","post","type-post","status-publish","format-standard","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/141131","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/users\/833"}],"replies":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/comments?post=141131"}],"version-history":[{"count":0,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/141131\/revisions"}],"wp:attachment":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/media?parent=141131"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/categories?post=141131"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/tags?post=141131"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}