Krafty

Some of you might have missed the news that the Takeover Panel has censured Kraft for breaking the promise it made during the Cadbury takeover battle that it would keep the Somerdale factory in Keynsham open.

According to the Guardian “The Takeover Panel’s ruling was based on Kraft’s promise in official stock market announcements that the UK would be ‘a net beneficialy in terms of jobs’ and its statement that, if it took over Cadbury it would ‘be in a position to operate the Somerdale factory… and invest in Bournville.”

Only a week after the takeover Kraft said that it could not keep Somerdale open because Cadbury had already spent more than £100m on transferring production to Poland. The panel has found that Kraft had “an honest and genuine belief” it could keep Somerdale open, but should have sought more information from Cadbury, especially as Cadbury had told Kraft executives that plans to close Somerdale were well advanced.

Doesn’t help us save the Keynsham plant, but perhaps it increases the pressure on Kraft to be seen to be doing the right thing and fulfil its latest promise to work with others to redevelop the site.

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Comments

  • Stephen  On May 29, 2010 at 3:24 pm

    If Kraft’s story is true, they should terminate with extreme prejudice their entire acquisitions team. Who the heck misses something like that during due diligence?

    Stephen

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