Submitted by: Submitted by JeanIan
Views: 541
Words: 1769
Pages: 8
Category: Other Topics
Date Submitted: 06/25/2011 07:06 AM
Nowadays, with globalisation many firms are seeking ways to gain competitive advantage and augmenting their market share by offer various products in various market place. The takeover of Cadbury PLC by Kraft Foods Inc. clearly illustrates the essence of global marketing.
Cadbury is very successful and well known for being a world-class confectionery company. Its clear identity is based on its reputation, an asset of matchless worth, which has been built over 186 years of history and has won the trust of those who buy its products. Dairy Milk, Flake, Crunchie, Chocolate Buttons and Milk Tray are among its international brands and has around 45,000 employees around 60 countries.
On the other hand, there is Kraft Foods Inc, the world's second-largest food company, founded as a cheese retailer in 1903 and was then sold to Philip Morris in 1988. Kraft Foods Inc. nowadays has around 98,000 employees who work in its 168 manufacturing plants around the world. Its 40 international brands varies from Philadelphia cream cheese, Kenco Coffee, frozen pizza to confectionery products such as Toblerone and Oreo biscuits are more than 100 years old.
The strategic acquisition of Cadbury PLC by Kraft Foods Inc, made formal and official on the 02 February 2010, has been central to much controversy and criticism from the stakeholders. Mr Warren Buffett, the main shareholder of Kraft Foods Inc. was the great opposer in this take over deal as following the research, conducted by RHR International, 50% - 70% of acquisitions fail but since the management decided not to raise any additional capital through new issue of shares, his opinion did not have any impact on the decision taken. He was, however, re-assured by the CEO to avoid any frustration. Conversely, the shareholders of Cadbury were satisfied with the proposal of Kraft which is to redeem part of their shares and offer a percentage of new Kraft Foods Inc. shares.
Another group of stakeholder, especially the one...