Cadbury said today (2 October) that a lawsuit filed against it by a minority shareholder for rejecting Kraft’s proposed offer is “entirely without merit”.
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Steward International Enhanced Index Fund, a US mutual fund holding 6,720 Cadbury shares, is arguing that the confectionery giant’s board failed to “properly consider” Kraft’s indicative offer for the company, according to The Guardian.
Cadbury first rejected Kraft’s GBP10.2bn (US$16.26bn) advance three weeks ago, claiming that the offer “materially undervalued” the company and its prospects for growth.
But the lawsuit said: “Cadbury shareholders stand to lose out massively if the Cadbury board continues to refuse to negotiate a transaction with Kraft.”
A Cadbury spokesperson however, said: “Cadbury believes the complaint filed by
Steward International Enhanced Index Fund is entirely without merit.”
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By GlobalDataKraft was this week (30 September) handed a deadline to make a formal offer for Cadbury or the US food giant would be forced to put any takeover ambitions on hold for six months.
The UK’s Takeover Panel said that Kraft must either announce a firm offer for the UK confectioner by 5pm on 9 November or “announce that it does not intend to make an offer”.
