Kraft Foods Inc. (NYSE: KFT) yesterday (Monday) refused to sweeten its $16.4 billion offer for Cadbury PLC (ADR NYSE: CDY).
Instead, the North American food giant repeated the terms of its original offer, which Cadbury rejected two months ago. Kraft will now put its bid directly to Cadbury shareholders, setting the stage for a battle that could last months.
Cadbury swiftly rejected the bid, saying the offer is now worth less than the initial proposal, which had already undervalued the company. Kraft's bid is now worth 4% less than the original offer, and 6% below the current stock price, because Kraft shares have lost some of their value.