The biggest effect of Kraft Foods’ takeover of Cadbury will be job losses and plant closures, a just-food reader survey has claimed.
Some 57% of readers believe job cuts and factory closures will be the most likely result of Kraft’s GBP11.7bn (US$18.36bn) acquisition of the UK confectioner.
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Kraft has sold US$9.5bn in debt to help finance the acquisition and fears that the leveraged nature of the deal will hit jobs remain high.
Yesterday evening (9 February), Kraft admitted it would push ahead with Cadbury’s plans to close a manufacturing plant in the UK after hinting when it first moved for the Dairy Milk maker that it could keep the facility open.
Asset sales could also be a likely effect of the takeover, the survey said. Some 46% said Kraft would look to offload parts of both businesses in 2010 to fund the deal.
Meanwhile, some 48% of respondents argued Cadbury would be “weaker” under Kraft’s ownership, although 28% of readers argued the Trident gum and Hall’s candy firm would be “stronger”.
Some 47% of respondents said the biggest benefit for Cadbury under Kraft’s ownership would be a boost to its presence in the US.
Over two-thirds said Cadbury would give Kraft a stronger presence in the confectionery sector.
However, 34% of readers claimed the US group, which owns Milka and Cote d’Or chocolate, had presided over a confectionery business that had under-performed the wider category in recent years.
