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Kraft's Lowball Bid Rejected By Cadbury

By Scott Rothbort

 About this article:
 Kraft (KFT) gets "The Gang That Couldn't Shoot Straight" Award for botching the bid for Cadbury (CBY). Kraft's formal bid, which was required to be delivered today, was for $16.3 billion. This bid was in fact lower than the original bid of $16.5 billion because the price of Kraft stock declined and foreign exchange variations. Cadbury rejected Kraft's bid. And who could blame Cadbury? Did Kraft want the business or not? For Kraft, either it is a strategic fit or not. If it is, then buy it for a reasonable price. Does Irene Rosenfeld think that the board of directors at Cadbury is a bunch of bumpkins? If the company was worth $16.5 billion a few weeks ago, why not fix the price at $16.5 billion at the very least? Kraft now runs the risk that a serious buyer steps up for Cadbury. Alternatively, perhaps Kraft and Rosenfeld...

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