Ferrero and Hershey Step Out of Cadbury Race

Ferrero was always believed unlikely to make an offer without the help of Hershey because it would have to borrow heavily to raise the firepower to match Kraft's offer.

25 Jan 2010 --- Ferrero International, the Italian chocolate group that makes Ferrero Rocher, Nutella and Kinder eggs, has ruled itself out of counter-bidding for Cadbury, leaving Kraft's agreed £11.9 billion bid unchallenged.

The company first said that it was considering making an offer on November 18.

The news came after The Hershey Company announced that it does not intend to make an offer for Cadbury, and issued a statement pursuant to Rule 2.8 of the City Code on Takeovers and Mergers.

The statement was issued following The Hershey Company's announcement on November 18, 2009 that it was reviewing its options with respect to a potential offer for Cadbury. The UK Takeover Panel issued a ruling that by 7 a.m. on Monday, January 25, The Hershey Company was required to either announce a firm intention to make an offer for Cadbury under Rule 2.5 of the Code or announce that it does not intend to make an offer for Cadbury.

Ferrero was always believed unlikely to make an offer without the help of Hershey because it would have to borrow heavily to raise the firepower to match Kraft's offer.

Individually, neither it nor Hershey has the financial resources to buy the whole company or have publicly listed shares to offer as a currency.