Cadbury Schweppes Share Discussion Threads

[talon13] 12/11/2009 17:19

On their own Nestle may or may not struggle with the financing for a bid. Hershey would love to get their mitts on parts of Cadbury, I'm sure, but alone they definitely couldn't afford to.

Which is why a joint Nestle/Hershey bid seems to make such blindingly obvious sense. Pooling their resources, they would have the firepower to outbid Kraft.

Unless of course Kraft have been lying to everyone and they are actually in much better shape than they'd like everyone to believe, but are just chancing their arm in trying to get Cadbury on the cheap. Krafty, eh??

But hell, what do we know?

[montyhedge] 12/11/2009 16:38

Nestle, shares + cash they could easily afford it.

[careful] 12/11/2009 16:19

Kraft need only to relax and let their share price go up about 15%.
maybe a little strengthening of the $ versus the 'brown £'.
and bingo..you have 900p without doing anything.

that is what will happen, I see that Kraft shares are rising again today.

[montyhedge] 12/11/2009 16:13

Now Kraft have made a offically take over approach, Nestle must be speaking to their advisers, they know a bid of 875p would wrap this up in one go.

[talon13] 12/11/2009 16:06

Here's a question to ponder on:

If you're the boss of Nestle (or similar company), would you just sit idly by on your fat bum whilst a rival company (Kraft) just waltzes in and picks up a super company like Cadbury dirt cheap?

Today's share price rise says not!

[montyhedge] 12/11/2009 15:36

Everyone with some common sense know Kraft will have to pay 810p minimum, counter bid would really set this alight.

[montyhedge] 12/11/2009 15:34

Paulson 2.54% stake at 759p average. He the shrewdest hedgie around, his looking for counter bid or 875p. I bet he increases to 4%+

[mallorca 9] 12/11/2009 10:44

Monty , I know what your game is here !
I have the same idea.

[talon13] 12/11/2009 10:30

Paulson buys a ton of Cadbury stock and 759 and is already showing profit on it. That's the way to make money, not like idiots like us that pay too much and are always left struggling just to break even.

(okay, we're not all idiots, just unlucky with our timing lol).

[talon13] 12/11/2009 10:28

Tonytravel: Do you hold your shares in certificated form? If so your name appears on the share register and you're leaving yourself open to be cold-called by any boiler room scammer that sees your name. If your hold your shares in nominee form it should not be possible for anyone to get your details; if they have, then something's amiss!

I hold my shares via a nominee account and have never had a cold call by some spiv trying to sell me some worthless penny shares, or offering me a deal that's 'too good to be true'.

[kumala] 12/11/2009 10:13

Shrewd cookie. is that you attached to the side of the rocket monty, LOL.
K

[montyhedge] 12/11/2009 10:02

With Paulson buying something going on.

[montyhedge] 12/11/2009 09:57

The most shrewdest investor Paulson Hedge Fund increase his stake in Cadburys, he is looking for 875p.

[kumala] 12/11/2009 09:10

Know what you mean tony, Thanks.
K

[tonytravel] 12/11/2009 08:56

KUMALA - the reference to the £9 price came from The Berkshire Fund salesperson AKA "Rachel".

Quite a novel change to be called by a young lady wishing to sell stock - to date my experience has been that I usually get an "East end Barrow Boy" trying on some scam.
They are most entertaining to listen to - as long as you don't take them on board.
ciao,tt.

[kumala] 12/11/2009 08:55

Talon13:
certinly more cheer this morning, Cadbury up 8p back above my 7.70 stop (mmmm) Have top sliced one of the banks for a small profit, just missed selling a retailer for a reasonable profit but signes are good that this will be off loaded today for a profit as well.
Interesting post above talon, still loooks all to play for takes time to catchemonkey, maybe Im just expecting a bit to much from this trading lark. HA
K ;)

[talon13] 12/11/2009 08:41

The following piece was in yesterday's Daily Mail, an editorial piece by City editor Alex Brummer, and is purely his opinion. Hope it gives you a reason to hang on in there:


"So 24 hours on, does the Kraft bid for Cadbury look any better?

Certainly not in the broker universe. Few people seem to dispute that a Kraft-Cadbury combination would make a formidable global chocolate force, and a scythe could be taken to costs.

Although one fears that parts of Cadbury might suffer the same humiliation as Terry's, now regarded by Kraft's Irene Rosenfeld as a very marginal brand.

The most serious criticism is that Kraft is seeking Cadbury on the cheap. As broker Bernstein points out, no deal has been done in the food industry since the turn of the decade at such a mean price.

The average has been 16.2 times earnings (before tax, interest and dividends) against the 9.7 implied by the offer for Cadbury.

In the broker's view, a fair price for what is seen as a once in a lifetime opportunity would be £9-a-share (that is far higher than the £8 mentioned in this space) for a branded goods group, which in large parts of the world, from India to Latin America, has the cache of luxury food.

At the £7.20p level implied by the Kraft bid, it is increasingly certain that missing rivals will be tempted into the fray.

Broker Jeffries International argues that the logic behind a Nestle/Hershey counter offer is strong.

Nestle would get the Cadbury gum business and re-acquire the rights to Kit Kat in the US (currently owned by Hershey) and the 30% of chocolate and confectionery not affected by anti-trust.

Hershey would acquire the core international business in the old Commonwealth and unify the Cadbury brand in the US (which it already manufactures).

Too neat, perhaps. But the first sprinter off the blocks is not always the victor."

[kumala] 11/11/2009 18:08

monty monty monty:

Youv cheered me up now budy, just read your link, this is the first I have heard of this, and just maybe, we might get some sort of price hike to above the £8 mark at some stage, If you dont mind i took the liberty to cut and paste the following, the game is not over yet as i was hoping, but the ball is still in play.

Cheers Montyhedge, talk tomorrow no doubt.
K
;)


LONDON -(Dow Jones)- Paulson & Co has added to its growing stake in takeover target Cadbury PLC (CBY) which now stands at 2.54% according to a UK regulatory filing Wednesday.

The New York-based hedge fund led by John Paulson bought 6.4 million shares at 759.96 pence each on Tuesday, having already doubled his stake by buying 14.8 million shares on Monday.

[montyhedge] 11/11/2009 16:45

PAULSON INCREASE AGAIN JUST OUT. HE WANTS 875P

[tonytravel] 11/11/2009 13:08

KUMALA - latest update from The Berkshire Fund re the proposed takeover :
The offer is to buy @ £7.09 (approx 7% discount). They are convinced the final price will be north of £9.
Although not biting - unfortunately I'm afraid they will continue to make calls in attempt to "eventually" rip me off - its good sport to listen to their sales pitch though!
ciao,tt

[kumala] 11/11/2009 11:34

OK Tony, thanks, you sound like your not one to be taken in by these scams, good for you.
I got nothing to add on the Cadbury saga at present, all to disapointing that a higher bid did not come forth, and the origonal bid is somewhat lower than first stated due to change in market conditions efecting Krafts share price
Am watching and calling in daily hoping for this to turn good in the end, am now stuck holding where I was hoping to reinvest the proceeds else where.
GRRRrrrrrrrrr
K ;/

[talon13] 11/11/2009 10:00

Kraft Foods is toying with Cadbury shareholders, Panmure Gordon reckons, after the US processed foods group announced a formal bid for the UK chocolate company that was effectively lower than the indicative one first made public two months ago.

The unchanged terms of Kraft's offer equate to 712p per Cadbury share or just 10 times the enterprise value/earnings before interest, tax, depreciation and amortisation ratio based on earnings estimates for 2010.

'Kraft still needs to offer a meaningful bid premium for Cadbury's shareholders to accept, and at the moment we view the premium as zero, given that Unilever is also trading at 10.0x EV/EBITDA for 2010E,' Panmure analyst Graham Jones said.

The broker has moved its target price down from 900p to 825p in the wake of Kraft's low-ball offer, and thinks the share price will tumble to around 700p if the bid fails. Panmure Gordon still thinks the odds are against Cadbury retaining its independence but the chances of surviving as an independent entity have increased 'from 15% to 30%'.


.........if the bid did fail and the share price only tumbled as far as 700 I could happily live with that. If Cadbury remains independent and can keep producing good numbers, the share price should trade up to 800 and beyond on its own effort anyway (at least that's my theory lol).

Anyone care to guess at how many short term speculators are going to become long term investors in this great company?