Kraft Foods US shareholders launch lawsuit
A lawsuit has been launched in America by a corporate shareholder in Kraft Foods suggesting that the Cadbury board of directors have not acted in the best interest of Cadbury shareholders and "may lose out massively" if the merger is rejected outright. So where does this leave the Cadbury board of directors?
The first thing to say is that UK mergers and acquisitions are regulated by the UK takeover panel and not their US counterparts. Secondly, as Cadbury has rightly pointed out today, Kraft Foods has not launched any formal bid for the company having only forwarded an indicative offer to the Cadbury board of directors for their consideration. So what next?
In many cases this US lawsuit is something of a red herring because ultimately it is yet another attempt to place more pressure on the Cadbury board of directors who themselves will have the best legal brains in the UK advising them. In simple terms, it is impossible to turn down an offer which has not actually being formally presented and funded by the third party in question.
There is still a long way to go with regards to the potential merger of Cadbury and Kraft Foods although the "put up or shut up" notice issued by the takeover panel should now focus the minds of the two groups and hopefully get them around the discussion table in the short to medium term.
Share this..
Related stories
Simple ways to save money : Phone bills
Even though we have entered a new era for the UK phone industry, with mobiles now as popular as landlines, many people still seem to be stuck on relatively old payment plans which are ultimately significantly more expensive than those introduced to the market over the last few months. If you have never reviewed your telecom payment plan it is time that you looked at your telephone bill and compare...
Read MoreUK government announces £20 billion loan insurance package
As we suggested yesterday, the UK government has today revealed plans for a £20 billion loan insurance package for small businesses. The move will see the government effectively guarantee loans to businesses, from the banks, which will take away the risk of default on the side of UK banks. However, interestingly the scheme has received mixed approval in the marketplace with many suggesting it is...
Read MoreBuilders: 200,000 new homes a year impossible
29/04/2015 Housebuilders have claimed that it would be impossible to build the 200,000 new homes in the UK each year, the amount pledged by Labour, the Liberal Democrats and UKIP. A survey from estate agents Knight Frank shows that just 9% of the 160 housebuilders asked believe the 200,000 target is achievable, with two thirds thinking that the maximum number of houses that will be able to b...
Read MoreUK banks must be allowed to grow again
In what is turning out to be a significant flip-flop of government policy, Treasury Minister Lord Myners has today suggested that UK banks must be allowed to grow again so that they can compete on a worldwide stage. This comment, while aimed at the Conservative party policy of reducing the impact and strength of the UK banking sector, is totally at odds with earlier suggestions by both Alistair Da...
Read MoreThe great government pension scandal
It has been revealed that upwards of 500,000 pensioners in the UK have been penalised by government assumptions on their income. When calculating a particular person's pension credit, all assets and all income has to be taken into account which on the surface appears fair enough. However, it is the way in which the government calculates interest on savings which is causing serious concern in the m...
Read More