Snacks & Candy

Ferrero, Hershey Bow Out

Rival Cadbury bid fizzles, strengthening Kraft's position
LONDON & MILAN -- Italy's Ferrero has decided not to bid for Cadbury Plc, further strengthening the case of Kraft Foods in its $17 billion takeover bid for the British chocolatier, reported Reuters. A source close to the situation told the news agency that Ferrero would not proceed with a bid. A second source close to Ferrero told Reuters that the company had ceased talking with Hershey, a potential partner in a rival bid.

Hershey has struggled to assemble a bid for London-based Cadbury and the Ferrero decision cast greater doubt on its ability to make an offer, said [image-nocss] the report. Hershey officials would not comment on whether it would proceed with an offer. Last week, Swiss food group Nestle ruled itself out of a Cadbury auction. (Click here for previous CSP Daily News coverage.)

Ferrero's decision came as Cadbury made its final case against the bid by Northfield, Ill.-based Kraft, delivering higher margins and promising a raised dividend, but the U.S. food group was still expected to succeed by slightly improving its offer, said Reuters.

Milan, Italy-based Ferrero produces products including Nutella chocolate-hazelnut spread; Ferrero Rocher, Pocket Coffee, Mon Ch ari, Giotto chocolates; Confetteria Raffaello coconut cream candy; and the Tic Tac breath mints.

(Click here for previous CSP Daily News coverage of the Kraft and Cadbury.)

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