Will Hershey's bid for Cadbury melt away?
There is new speculation regarding a potential offer for Cadbury by Hershey this morning with concerns that a potential offer may be starting to melt away. A review of the recent history of Hershey, which is controlled by a charitable trust, shows that the trustees of the charitable trust voted against a deal to sell the company to Wrigley back in 2002 for $89 a share. The current share price is $36 a share.
There are some in the market who believe that the company, with a market cap of just over $8 billion, is moving into very high-risk territory with a potential $17 billion offer for Cadbury. This would be a massive risk for a company which was one minute considering a sale to Wrigley and is now considering a massive expansion of the operation. While there is no doubt the company could benefit from the acquisition of Cadbury, by simply diversifying operations and cost savings, it would in affect treble the size of the company overnight, a situation which would bring its own unique problems and opportunities.
The truth is that the only firm offer on the table is from Kraft Foods, even if it is well below the current share price, and until we start to see more "greenbacks" hit the table there is very little to consider at this moment in time.
Share this..
Related stories
Complaints to water companies fall
15/09/2014 Complaints to water companies have largely fallen for their sixth year in a row, according to the water bill watchdog, Consumer Council for Water (CCWater). The number of written complaints made by customers to water companies in England and Wales fell during 2013/14 by 18 per cent – more than twice the rate of decline seen the previous year. This means written complaints are no...
Read MoreTUC calls for more social housing
Young workers will not be able to live in their own homes unless the government authorises more social housing construction, the Trades Union Congress (TUC) believes.The government currently plans on earmarking spending for 30,000 social housing units for rent every year over the 2008-11 period as part of its efforts to balance out the supply side of the demand-heavy UK residential housing market....
Read MoreCar manufacturers introduce price hikes after rescue package
It has been revealed that Vauxhall and Ford are looking to increase the price of their new cars by as much as 5% after confirmation of the UK government's £2.3 billion liquidity package. Even though the £1.3 billion coming from the EU has yet to be cleared it appears as though UK car manufacturers have taken this opportunity to increase prices even though business levels have fallen to record lo...
Read MoreEnergy bills will rise, SSE warns
Energy bills seem set to rise further before winter, the head of Scottish & Southern Energy (SSE) has indicated.According to the energy provider, high wholesale prices for gas and electricity will cause the rises for its nine million customers.With the owners of British Gas, Centrica, making similar comments recently, it is likely that most UK householders will be paying more in months to come.The...
Read MorePost Office chain under threat
The National Federation of SubPostmasters has today issued a report on the Post Office network with claims that around 3,000 of the current 11,500 post offices could close in the short to medium term. The federation believes that an imposed wage cut will leave many post offices on the verge of collapse and impact upon many local communities up and down the country. This situation in the UK Post...
Read More