25 November, 2009
UPDATE 2-UK Cadbury union hopeful after talks with Kraft
* Cadbury union official says Kraft talks "constructive"
* Kraft, Unite union have agreed to keep talking
* Hershey contacts Pennsylvania AG on potential bid-WSJ
* Cadbury investor Peltz sells shares (Updates with report on Hershey Trust, Peltz sells shares)
By David Jones and Victoria Howley
LONDON, Nov 25 (Reuters) - A Cadbury (CBRY.L) workers union met on Wednesday with U.S. suitor Kraft Foods (KFT.N) to discuss jobs, pensions and working conditions, said a union official, who called the discussions "constructive."
Britain's biggest union, Unite, which has 2 million members, met executives from Kraft's European management team in London after the union had written to Kraft Chief Executive Irene Rosenfeld seeking assurances if the company succeeds in taking over the UK confectionery company.
"The meeting was productive. We discussed the issues we laid out in the letter and hopefully they listened," said Jennie Formby, Unite's national officer for the food industry, who attended the meeting.
"They were keen to say they did not have enough information to give us firm assurances at this stage. But we are committed to further talks, as we are prepared to talk to all potential bidders for Cadbury," she added.
Formby said no date had been set for the next meeting with Kraft.
Kraft launched its official cash and shares bid earlier this month. The bid currently values Cadbury at 722 pence a share, or 9.9 billion pounds ($16.4 billion), though the shares are trading at 811p on hopes that rival interest that might push Kraft to raise its offer.
Italy's Ferrero and U.S. based Hershey Co (HSY.N) have said they are considering making bids for Cadbury, while Switzerland's Nestle (NESN.VX) has been cited by analysts as a possible partner for Hershey in a bid.
HERSHEY TESTS POLITICAL WATERS
The Hershey Trust, the charitable trust that is the major shareholder of Hershey, has sought the approval of the Pennsylvania attorney general for a potential $17 billion bid for Cadbury, the Wall Street Journal said on Wednesday.
According to the report, Trust members said several weeks ago that they reached out to Attorney General Tom Corbett. People in Corbett's office said they needed more details on a deal to decide what the attorney general's view should be, the Journal said.
"We haven't seen anything regarding any potential transaction," a spokesman for the attorney general's office told Reuters on Tuesday. The spokesman could not be immediately reached for comment on Wednesday.
The AG's office would monitor any transaction involving the Hershey Trust to make sure the Trust's interests are protected, the spokesman said. The Hershey Trust declined to comment.
Meanwhile, billionaire activist investor Nelson Peltz cut his stake in Cadbury to 2.68 percent from 3.03 percent, saying it was the result of adjustments his fund group made to its portfolio.
Peltz is viewed as a key figure who could influence any Cadbury deal. His Trian Fund Management built up its 3 percent stake in Cadbury Schweppes Plc in early 2007 and put pressure on its board to spin off the North American soft drinks business and create pure confectionery group Cadbury.
When Kraft went public with its interest in Cadbury in early September, it said it hoped to reverse Cadbury's plans to close its Somerdale sweet factory near Bristol in southwest England and also invest in Cadbury's main British plant at Bournville.
Cadbury said in 2007 that its Somerdale plant would close by 2010 with 500 job losses and that Bournville will lose 200 jobs by 2010 as the company shifts production to Poland as part of a strategy to drive sales growth and boost margins.
The Somerdale factory, in the town of Keynsham near Bristol, is expected to close completely towards the end of 2010.
Kraft itself closed its Terry's factory in York, northern England, in 2005 with the loss of more than 300 jobs to end more than 200 years of chocolate making as the manufacture of Terry's chocolate oranges and All Gold moved to Kraft plants in Sweden, Belgium, Poland and Slovakia.
($1=.6045 pounds) (Additional reporting by Jessica Hall; Editing by Steve Orlofsky) (For more M&A news and our DealZone blog, go to here) ((jessica.hall@thomsonreuters.com; 215-922-1086; Reuters Messaging: jessica.hall.reuters.com@reuters.net))
Source: http://www.reuters.com
UPDATE 2-UK Cadbury union hopeful after talks with Kraft Added: (25.11.2009)
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