After several weeks with little activity since Kraft first expressed an interest in acquiring Cadbury’s I now expect to see some movement on this story very shortly.

Kraft have now arranged a staggering $9billion in new finance via a number of major banks which is a first requirement of any potentially hostile takeover approach. Also there is a fast approaching time deadline under the UK  Takeover Regulations that mean any formal bid must be made by Monday next week or Kraft will have to wait a further six months before a new approach can be made. Arranging finance on this scale takes time and costs money too, so I will be amazed if things don’t start to happen in the next couple of days.

Kraft have just posted third quarter profits of $824million, down significantly on the same period last year, which makes growth by acquisition a likely further incentive for them as they consider their Cadbury position. Both companies are suppliers to KSV with Kraft’s Kenco range of drinks and vending machines plus Cadbury’s Hot Chocolate having a significant position in our marketplace.

Two suppliers may become one very shortly!

Written by: Colin from KSV.