Description: Italy’s Ferrero and U.S.-based Hershey Co are considering a bid for chocolatier Cadbury Plc (CBRY.L), but Kraft Foods Inc (KFT.N) is still seen as the front-runner with its $16.8 billion hostile offer.

Source: Reuters.com

Date: 11/18/2009

Link: http://www.reuters.com/article/ousivMolt/idUSTRE5AH14V20091119

Questions for discussion:

• Summarize the financial reasons favouring the acquisition of Cadbury by Ferrero and by Hershey.
• Which firm do you believe would derive the greater financial benefit from the acquisition? Explain your thinking.