Please don't sell Cadbury out, workers appeal to shareholders
22nd January 2010
Ahead of the vote on the bid by Kraft for UK confectionery
company Cadbury, Unite the union has written to all shareholders
asking them to reject the revised offer.
Citing the acknowledgement by Cadbury chairman Roger Carr that
job losses would be "inevitable" and that Kraft was an
"underperforming" conglomerate, Unite is convinced that the deal,
even topped up to nearly £12 billion, is still bad news for workers
and shareholders alike.
Calling on shareholders to look beyond the money on the table,
Jennie Formby, Unite national officer for the food sector, said:
"When even Warren Buffett, one of Kraft's biggest shareholders,
denounces this as a bad deal, we sincerely hope Cadbury
shareholders will look before they leap into the takeover.
"Our huge fear is for the many thousands of workers in the UK
and Ireland who depend on Cadbury for their livelihoods. They
are devastated that the company and its values will change beyond
recognition, and that many jobs will be shed as Kraft attempts to
shake off some of its horrendous debt.
"While there is still time for Cadbury shareholders to consider
this offer there must be hope that wisdom will prevail. Unite
has been inundated by messages from smaller shareholders who tell
us they do not want this deal, and the popular outpouring of
support for Cadbury shows there is no appetite for this
deal.
"The City boys and hedge funds, who are only interested in
turning a quick profit and care nothing for the people or
communities of Cadbury, cannot be allowed carry the day."
Cadbury shareholders will vote on the revised offer on February
2nd. Some large institutional shareholders - including
Standard Life - have voiced concerns that even the revised Kraft
bid still massively undervalues Cadbury.
Unite is planning a lobby of parliament by Cadbury workers to
press for support from government and MPs in the fight to protect
Cadbury jobs and investment.
ENDS
Notes: The full text of the letter says:
Dear Cadbury Shareholder
Revised Kraft bid for Cadbury
Following the revised bid of the 19th January by Kraft, I am
writing to all Cadbury shareholders once again to ask you to
consider the following points very carefully before taking any
decision on the new bid by Kraft for Cadbury.
*On 14th January, Roger Carr stated that Kraft was a “low growth
conglomerate with a history of underperformance and a track
record of missed targets” and with shares “which have
significantly underperformed their peer group since listing in
2001” (source: Further reasons to reject Kraft’s offer, Letter from
the Chairman 14 January 2010)
Nothing has changed since Roger Carr made this statement other
than the value of the bid.
*Unite’s previous document to shareholders referred to high
levels of Kraft debt. Nothing has changed to our view about the
risk that debt at this level poses to employees, brand reputation
and shareholder value.
*The guarantees that Unite sought from Kraft for the UK and
Ireland (commitment to future investment, and guarantees of no site
closures, no compulsory redundancies, no erosion of terms and
conditions, no diminution to pension benefits or increase in
pension contributions) have still not been given. Instead Roger
Carr, Chairman of Cadbury has been widely quoted in the media as
saying that jobs will be lost.
*The media has also reported massive public opposition to the
takeover in the UK which in itself could potentially damage brand
reputation.
We therefore once again urge shareholders to consider very
carefully the wisdom of the revised Kraft bid and indeed of any
takeover of Cadbury.
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