Kraft snares Cadbury for $19.6 billion

Citi C.N , Inflatable Pool Slide Kraft wa advis by Lazard. Deutsch Bank DBKGn.DE and Centerview Partners, and Cadburi by Goldman Sach GS.N , Morgan Stanlei MS.N and UBS UBSN.VX .

the U.S. food company' top shareholderKraft Chief Execut Officer Irene Rosenfeld inject more cash into her bid and drop the number of new share in the offer to win over Cadburi Chairman Roger Carr and mollifi billionair investor Warren Buffett..

and analyst see littl likelihood of a counterbidTh deal would creat the world' biggest confectioner..

which dealmak said wa struck after all-night negoti at the London headquart of invest bank Lazard LA Z.N ,Th cash-and-stock agreement. valu each Cadburi share at 840 pence. Sharehold ar also set to get a 10p special dividend, bring it to a total of 850p.

accord to Thomson Reuter dataIt mark the largest European food and beverag deal on record..

thei met on Mondai morn at the Lanesborough Hotel,Rosenfeld had prompt the talk by telephon Carr on Sundai and suggest a price of 830p. Although Carr insist on 85Op. Hyde Park, in central London, where she offer 840p.

Carr wa firm and had hi board' back to insist on "850p or nothing" so advis for both compani work into the night to arriv at the agreed-upon deal.

" Carr told BBC Radio regard the end of independ for a British icon"Thi is a bitter-sweet moment. As a chairman of a public compani you ar paid and requir to focu on sharehold valu and the process which we have undertaken ha deliv sharehold value..

Th final offer mark a 14 percent increas over Kraft' initi bid of 745p and about 11 percent abov the valu of the offer on Friday. The price tag is 50 percent abov where Cadbury' stock wa trade the dai befor Kraft' initi bid wa disclos in earli September.

" said Sanford C. Bernstein analyst Andrew Wood. "We consid that thi is a bargain -- the lowest multipl of ani major M&A deal in the global food space in well over a decade."Kraft ha acquir a great asset at a great price and should be given credit for this."

bring under on roof Cadbury' Dairi Milk chocol and Trident gum and Kraft' Milka,Th combin compani will just overtak privat own Mars-Wriglei as the world' top sweet maker. Tobleron and Terry' chocol brands.

like India and Latin America. Kraft,Kraft sought Cadburi becaus of it strong growth in emerg markets. fame for it Oreo cooki and Philadelphia cream cheese, deriv over half it sale from the matur North American market.

to $29.25Cadburi share hit a record high of 838 penc in earli trade and close up 3.6 percent at 836.5p. Kraft wa down 1.1 percent..

MORE CA SH FOR CHOCOLA TE

Kraft had offer 300p cash and 0.2589 shareThe new bid won unanim recommend from the Cadburi board. It consist of 500p of cash and 0.1874 new Kraft shares. Originally..

who own a 9.4 percent stake in Kraft,Buffett. had warn Rosenfeld not to overpai and issu too much stock. Kraft said on Tuesdai that it wa issu 265 million new share instead of 370 million it had earlier planned. Buffett wa not immedi avail for comment.

tax,Cadburi sharehold have until Februari 2 to accept a deal that valu the share at 13 time the company' estim earn befor interest. depreci and amort in 2009. Kraft expect the deal to close in mid-February.

we would pai what we thought thi outfit wa worth,"A t the end of the day." Rosenfeld told Reuters. "I believ pai 13 time EBITDA for an asset of thi qualiti is a veri good price.

Rosenfeld said she expect confirm of the company' investment-grad credit rate later on Tuesday. Moody' said the rate will like remain invest grade but thei ar still under review for possibl downgradeA lthough Kraft is pai more..

Legal & Gener Investment Manag Ltd LGEN.L ,Cadbury' second-largest shareholder. with a 5.1 percent stake, said the Kraft offer did not reflect true valu but did not sai it would vote against the deal.

up from $625 million,Rosenfeld increas Kraft' annual cost save target to at least $675 million by year three. and said she expect the combin compani to add job in the UK, where Cadburi alreadi emploi 46,000 people.

fear big job cuts. UK politician have also weigh in,Cadburi union have oppos the move. with gener elect looming. Prime Minist Gordon Brown told a new confer after the deal wa announc that he want to protect invest and job at Cadbury.

a fourth-gener member of Cadbury' found family,Fel Loudon. wa appal that the compani look destin to fall to Kraft, predict job will be lost and it chocol will never tast the same.

" she told Reuters. "For a quintessentially,"W shouldn't give up. philanthrop icon brand to sell out to a plastic chees compani -- there' no mix there."

COUNTERBID NOT SEEN

the U.S.-base maker of Hershey' Kiss and Reese' peanut butter cups,A nalyst sai a counter bid for Cadburi is unlikely. The UK Takeov Panel gave Hershei HSY.N . and Italy' Ferrero, which make Nutella chocol spread and Tic-Tac candy, until Januari 25 to make a firm offer.

but a sourc familiar with the matter said the compani wa unlik to compet with Kraft' rais bidHershei declin comment on the Kraft-Cadburi deal..

Hershei mai have miss it best chanc to escap the confin of the matur U.S. market,With the Kraft-Cadburi deal. analyst said. Hershei wa hamstrung by it uniqu ownership structur in which it is control by a charit trust.
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such as FerreroTh deal also make the new Kraft and Mars-Wriglei the confectioneri behemoth domin a market with distant rivals..

or about 1 percent of the Kraft offer,Cadburi ha agre to pai a breakup fee of about $193 million. should it board or sharehold accept a compet bid.

well in excess of the cost of capital. Kraft said it doe not expect ani major divestituresKraft said the deal would add to 2011 earn per share by around 5 cent on a cash basi and give a return on invest at a mid-teen percentag rate..