Kraft makes an offer Cadbury can’t refuse
NORTHFIELD, Ill. Things just got sweeter for Kraft as its offer to purchase U.K.-based Cadbury for 11.7 billion pounds (U.S. $19 billion) was accepted Tuesday.
The deal marks the end of an era, as the British chocolate maker’s nearly 200-year independence draws to a close.
“We believe the offer represents good value for Cadbury shareholders and are pleased with the commitment that Kraft Foods has made to our heritage, values and people throughout the world,” said Cadbury chairman Roger Carr. “We will now work with the Kraft Foods’ management to ensure the continued success and growth of the business for the benefit of our customers, consumers and employees.”
The final offer represents 13 times Cadbury’s underlying 2009 EBITDA, Kraft said, and includes both cash and stock. Under the terms of the proposal, Kraft will pay 840 pence ($13.70) for each Cadbury share, while Cadbury will pay out a special dividend of 10 pence per share. Although the deal was unanimously approved by Cadbury’s board, the final offer did not need the approval of Kraft shareholders.
“We have great respect for Cadbury’s brands, heritage and people. We believe they will thrive as part of Kraft Foods. This recommended offer represents a compelling opportunity for Cadbury shareholders, providing both immediate value certainty and upside potential in the combined company. For Kraft Foods shareholders it transforms the portfolio, accelerates long-term growth and delivers highly attractive returns, while maintaining financial discipline,” said Kraft chairman and CEO Irene Rosenfeld.
Kraft has sought to purchase the confectionary since November 2009, after launching a $16.3 billion bid. The initial offer, Cadbury chairman Roger Carr said, undermined the value of the company. There also were rumors that other confectionary kings, namely Hershey and Ferrero, were seeking to takeover Cadbury, but would split the business.
In December, Kraft reached out a second time with a $16.5 billion bid. In response, Cadbury issued a defence document, which noted that the company raised its outlook and future goals as an independent company.
Report: Walgreens to develop prepared meals for customers on the go
DEERFIELD, Ill. Walgreens is gearing up to begin selling prepared meals and more fresh foods in some of its 7,149 stores, according to published reports.
The chain is reportedly negotiating with several major food suppliers, including Nestle SA, Sara Lee Corp. and Unilever, in a bid to begin offering its own private-label line of food products. The company is also set to hire a merchandise manager in charge of fresh foods in the coming weeks, according to Bloomberg News Service and The Nashville Tennessean.
Walgreens has already begun the limited sale of prepared foods like wrapped sandwiches, frozen pizzas and a small selection of produce in some urban stores in neighborhoods that are underserved by local supermarkets or other food stores. But its plans to add a director of fresh foods to its management staff – and to begin selling prepared meals and fresh foods in many of its stores – marks a major step forward in its commitment to the food category.
If successful, the effort also could help in the company’s major campaign to boost front-end sales and per-customer sales chainwide. Through its Customer Centric Retailing and “More from the Core” strategies, Walgreens has launched an aggressive drive to encourage its customers to add at least one more item to their shopping baskets per trip. If successful, the effort would add billions of dollars to the company’s revenues.
Sources at Walgreens could not immediately be reached for comment.
Smart for Life Cookie Diet makes its way to USA Drug
BOCA RATON, Fla. Smart for Life Cookie Diet is extending its reach to USA Drug stores, Smart for Life announced Friday.
The Smart for Life weight-loss products are now in 80 USA Drug locations in Arkansas, Missouri, Mississippi, Tennessee and Oklahoma. Smart for Life Cookie Diet’s sister company, Better Health Beverage’s underWAY appetite-suppressing beverage, will also be available in February 2010.
The announcement comes at the heels of the diet product line’s launch at Discount Drug Mart stores in Ohio.
“Our partnership with USA Drug now provides more consumers the availability of the Smart for Life program,” said Sass Moulavi, M.D. and creator of the Smart for Life Cookie Diet.