Buffett slams Cadbury deal
MAJOR Kraft shareholder Warren Buffett has attacked the US company’s £11.7bn proposed takeover of chocolatier Cadbury as a “bad deal”.
Buffett, who made a high-profile intervention earlier in the month when he warned Kraft chairman Irene Rosenfeld not to overpay for the British company, said he felt “poorer” as a result of the 850p per share offer.
Buffett said: “She [Rosenfeld] thinks this is a good deal, I think it’s a bad deal… If I had the chance to vote on this, I’d vote no.”
Widely seen as the world’s most successful investor, Buffet owns 9.4 per cent of Kraft through his Berkshire Hathaway vehicle. His fears centre on the share component of the bid as he feels Kraft’s paper is undervalued at around $28.70.
Buffett’s comments will create unwelcome background noise for Rosenfeld as she tries to win over dissenting Cadbury shareholders such as Legal & General and Neptune by 2 February. But Kraft does not require the cooperation of its own investors.
Meanwhile, Liberal Democrat leader Nick Clegg said it was “plain wrong” that 84 per cent state-owned RBS was financing Kraft’s takeover. Clegg said taxpayers’ money would be used to make some of Cadbury’s 6,900 UK workers redundant.