Cadbury Schweppes Plc has rejected a private equity bid for its North American
soft drinks unit valued at between £6.4-6.9 billion pounds ($13-14 billion)
due to the financing of the offer.
consortium of Blackstone Group LP, Kohlberg Kravis Roberts & Co. and Lion
Capital offered Cadbury wanted Cadbury to be involved in part of the financing
of the deal, sources pointed out.
the world''s largest confectionery group, declined more due to the financing rather
than the value of the bid, industry sources said.
the terms of the deal, Cadbury would have had to put up a third of the financing
- a move considered to be risky for the company''s shareholders.
had said in March it would hive off its Dr Pepper and 7UP unit, and a sale to
private equity buyers seemed most likely. However, the auction was delayed as
turbulence hit the debt markets in late July.
the maker of Dairy Milk and Trident gum, is still committed to separating the
drinks business and already reports it as a discontinued business. However, it
may now opt to demerge the drinks business rather than sell or float it after
problems in the debt market made it more difficult for private equity firms to
handle high cost deals.
meanwhile, announced the recall of thousands of chocolate bars in the UK after
it discovered the nut allergy labels were missing, the company said.
printing error led to the omission of a message warning consumers that Dairy Milk
Double Choc packs could contain traces of nuts, the company said in a statement
allergy sufferers should not eat the recalled bars and should contact the company
for a refund, Cadbury said. It added that the bars were safe for people who did
not suffer from nut allergies.
other Cadbury Dairy Milk products were affected, the company said. Cadbury Schweppes
PLC was fined 1 million pounds (€1.48 million US$2 million) in July for salmonella
contamination of its chocolate products.