I have chosen to talk about the controversial takeover of Cadburys by Kraft Foods.

In 2009 The US food company, Kraft Foods, launches a hostile bid for Cadbury. Two years later in 2011, it became clear that Cadbury was the final acquisition needed by Kraft to allow the company to be restructured into two companies by the end of 2012.
The challenge for Kraft was to buy the Cadbury company when it wasn’t for sale!

By the time Kraft made a bid for Cadbury, it was the second largest food company.

Cadbury had also grown through mergers and demergers. It had begun a strategy that was beginning to show results.

Not only was Cadbury not for sale, but, it actively resisted the Kraft takeover.

The chairman of Cadbury was experienced in deflecting takeover bids and put together a strong team to resist the takeover. They decided that if there was to be a takeover eventually, then the list of potential takeovers from companies such as Nestle, Ferrero and Hershey would be far preferable to a takeover by Kraft. The worry was that there would be a lack of respect for the historic confectioner.

Cadburys rejected the takeover because they would be “absorbed into Kraft’s low growth conglomerate business model”

At this point, Cadbury didn’t know that Kraft’s plan was to split in two to eliminate its conglomerate nature and become two more focused businesses thereby creating more profit for its investors.

The Cadbury team decided that a majority of the shareholders would sell at 830 pence per share. A deal was struck at 840 pence per share plus a 10p per share dividend. This was approved by 72 per cent of Cadbury shareholders.

As this deal demonstrates, these shareholders may not be the long term traditional owners of the target company. These people may not be particularly interested in the company itself, but are influenced by the offer price and how quickly the deal can be completed.

The takeover of Cadbury by a US firm in 2010 prompted a review of the rules governing how foreign firms buy UK companies.

The Takeover Code strengthens the position of Target companies, and demand more information from bidders about their intentions after the purchase. This includes repercussions for jobs and assets like factories. The bidder also has to give information about the locations of the company headquarters.

In conclusion, the disadvantages of this merger were:
• The loss of 200 jobs.
• Kraft promised to keep the Somerdale factory open but then decided to shut the factory which employed 400 staff.

The advantages were:
• Kraft made a £50 million investment which is crucial to the long term future of Cadburys.
• Kraft honoured the two-year agreement of no redundancies.

References:

Not only was Cadbury not for sale but it actively resisted …. https://www.coursehero.com/file/p6ab2c5/Not-only-was-Cadbury-not-for-sale-but-it-actively-resisted-the-Kraft-takeover/

The response Cadburys own defense documents stated that …. https://www.coursehero.com/file/p7o1pstj/The-response-Cadburys-own-defense-documents-stated-that-shareholders-should/

Tesla was founded in July 2003 by two businesses men Martin Eberhard and Marc Tarpenning under the name Tesla Motors. Now the company is mostly related to one person Elon Musk as he is the current CEO.

 

Since Elon Musk undertook a higher position within Tesla, Tesla has produced more products and services to a wide audience within such a short period.

Tesla has reinvented how cars operate and how to use energy in an efficient and environmentally way whether that is using fossil fules or battery power and it seems that the car industry is now following in that direction. Some of the car companies have not yet decided to go fully electric as they are starting to bring out hybrid vehicles and they are a mix of electric power and fuel.

Tesla cars are fully electric and offer to all of their customers’ free charging if they use the Tesla chaging points.

I strongly feel that Tesla is one of the first company to have a strong driving force into renewable products that can be powered by natural energy. For example, Water, Wind and Sun. If we can start using more renable sources of power then eventually we will begin to see more electric vehicles and hopefully have fully electric Taxies, Buses, Trains, Boats and Planes. If Tesla can produce such a product that can provide such power from renewable sources then hopefully climate change will be extinct.

 

Tesla is now moving to other methods of powering the essential things in our lives. For example, Tesla is developing a solar panel which is built into your roof tiles. The point of this is to keep the looks of the house to its best and to get away from the current solar panels that we have that need to be attached to the roof with brackets. The advantage of having a solar panel in each tile is that if one breaks, then you only have to replace that one instead of the whole solar panel if it was the ones we have today. The second advantage is that it will also have better coverage as it will be the entire roof rather than a single panel.

 

I personally think that Tesla is going to be the company that changes the way we harnish, store and use energy what do you think?

Thanks for joining me!

Good company in a journey makes the way seem shorter. — Izaak Walton