Chocolate’s poacher or gamekeeper?

Unless you’ve been on Mars this week, you’ll know all too well that Kraft have now purchased Cadbury.

Well, it now turns out that Goldman Sachs, Morgan Stanley and UBS, hired by Cadbury, are – thanks to the purchase – to be paid more than if they’d successfully defended the hostile takeover.

It’s easy to flow with the anti-bank sentiment at the moment, but throughout the process we were led to believe that Cadbury’s management were hell-bent on seeing off the greedy American and retaining a British jewel. Let’s remember, Kraft is only in buying mood because they think organic growth is unlikely and Cadbury has a bigger future ahead of itself. They sounded like a deer being hounded by a savage tiger. Now it’s apparent that they gave the gatekeepers strong odds to leave the door open!

Nice to see the basic theory of management is still alive and well: what you reward, gets done.

Warren Buffet, Kraft’s largest shareholder, felt their shares were undervalued so instructed 500p in cash make up the 840p offer. That’s around £7 billion in bank debt added to balance sheet.

I guess it’s only fair banks both sides of the pond maxed out, right?

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