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Did Kraft Foods really get the Cadbury deal wrong?

There are still reverberations in the US stock market with many prominent Kraft Foods shareholders critical of the price the company ended up paying for UK outfit Cadbury. The £11.9 billion outlay, part funded by cash and shares in Kraft Foods, is seen by many in Europe as a "steal" but the opinion of US investors is very different. Warren buffet has been particularly critical of the Kraft Foods management and suggested that if given the opportunity to vote on the takeover of Cadbury he would actually have voted against the management.

Whether we will see any potential management changes as a result of the Cadbury saga remains to be seen but only now are we starting to see how aggrieved many investors are regarding the deal. On the plus side there is no doubt that, price aside, the fit between Kraft Foods and Cadbury is almost perfect with many analysts suggesting they were "a match made in heaven" at a very early stage of the proceedings. There is no doubt that the enlarged group will have a more prominent position in the global marketplace and be able to reach out into new markets and new customer bases.

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