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Presentation about the takeover in detail
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THE CADBURY –
KRAFT TAKEOVER
British multinational company
Started by John Cadbury in 1824
Dairy Milk produced in 1905
Merged with Schweppes in 1969
Merged with Kraft in 2010 ($11.6 billion deal)
Merged with Mondelēz International in 2014
John Cadbury
World’s 2nd largest food company (After Nestle)
Began in Chicago by James L. Kraft
Known for selling 31 types of cheese
Change name to Kraft Cheese Company in 1932
Started with ice cream manufacturing and expanded into a full range of dairy products
James L. Kraft
Before the
takeover…
Why did Kraft
takeover
Cadbury?
1. Great access to sharp growth
2. Knowledge sharing
3. Be a leader in confectionary items
4. Great move for the company
5. Increased revenue by $1 billion in 2013.
6. Economies of Scales
7. Increase monopsony power
8. Help to negotiate with other bigger
retailers and suppliers
9. Strengthens brand
10. Higher performance = higher revenue
11. Better reputation
12. Better control of company
The Negatives to
Cadbury
1. Damages heritage 2. Weakens brand 3. Staff burnout
4. Risk of losing benefit schemes
5. Trust issues
Type of
Integration
Conglomerate integration
E.g. Kraft – dairy products
Cadbury –confectionary
products
“Proposed deals bring together two
very different organisations with
cultures and histories that appear to have
more differences than similarities.”
Problems with
the integration
1.
A lot of management time will be taken up
2.
- Cadbury merged with Schweppes in 1969
- It ranked low on profitability and competitiveness.
- May 2008, Cadbury Schweppes split its business into two separate companies;
- Cadbury focused on confectionary market
- Schweppes focused on US drinks.
- So will this happen to Cadbury – Kraft? … IT DID
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