Why sell Cadbury ?

[Coldicote]

There have been many references recently about offers being made to buy the Cadbury chocolate business. Does anyone know why this is happening? Is Cadbury in financial difficulty and needs to sell? With all the 'chocoholics' there are about, including myself, I wouldn't have thought there was any lack of trade.

[kellee]

l do not think that Cadbury are in trouble, it has been called a hostile takeover, in my opinion it means that another company wants to be top dog in the game and that means they have to take over cadbury, all it means is that a bullyboy company is being just that a BULLy, the shareholders are being given a big incentive to sell their shares and that to me is not really a good thing, another british based company down the pan for the sake of greed AGAIN.

[buildersmate]

Of course the market price of the shares in Cadbury determine its worth - and that market price is driven by relative supply versus demand from investors.
The business is well-run and definitely not in trouble, as others point out. Which is why the hostile bid has to be over the current odds (as perceived by investors) to try and make it attractive for them to sell.

[Trotbot]

Cadbury is healthy company with a rang of strong brands in the UK, Europe, Australia and parts of Asia. Kraft is in the same business, but are weak in most of those places, and strong in the US, where Cadbury are not as strong. On paper, it may make sense. However, the business models and company values are different, so maybe there are problems with integration, not least with Cadbury management keeping their jobs. Being slightly cynical, management tend to support bids that will benefit management. This one probably wouldn't (and to be fair to management, it probably would not help the Cadbury brand, but if the current shareholders make money now and have no immediate prospect of making even more money soon, they may support it. The beauty (or inherent flaws) of the free market writ large

[Trotbot]

Kraft will not asset strip, that applies to situations where the total assets are worth more than the company. They might close down UK manufacturing in the medium term (unlikely, they are not idiots), but it is not asset stripping. Also, who are the Cadbury family? It was the Bournville family way back when, but it is a public company now