POINT OF VIEW

I believe that the viewpoint of this case should belong to the UK

government, including the UK Takeover Panel. I think it is just important that
the government voices its concern since Kraft’s takeover attempt of Cadbury is
cautioned against the long-term effects and obligations of transparency and
accountability of foreign ownership.

STATEMENT OF THE PROBLEM

Since the UK government seemed not in favor of the takeover of home-

grown chocolate champion – Cadbury, how should they restrict foreign
companies like Kraft not to circumvent their local market as easily as they
could?

OBJECTIVES

• To put limitations on foreign investors like Kraft on their takeover

against Cadbury.
• To keep the cultural heritage Cadbury established on the UK government
especially on its local communities.
• To establish harmonious relationship between foreign investors and local
companies in the British government.

ALTERNATIVE COURSE OF ACTIONS

ALTERNATIVE NO.1: MAINTAIN LOCAL OWNERSHIP OF COMPANIES

BY PREVENTING FOREIGN INVESTORS

Pros:
⇒ Strengthened Heritage
⇒ Higher moral and performance for workers

Cons:
⇒ Stagnant local market
⇒ Less opportunity for growth

ALTERNATIVE NO.2: IMPLEMENT STRICT RULES AND

REGULATIONS LIMITING FOREIGN INVESTORS, AT LEAST, TO PUT
SOME BURDEN ON THEM ENTERING THE LOCAL MARKET OF U.K.

Pros:
⇒ There will be registration formalities such as reporting
requirements, statutory books and articles of association
⇒ Efficiencies through alignment of procedures and process

Cons:
⇒ Feelings of insecurity and uncertainty of the future
⇒ Risk of diminishing Cadbury’s brand
RECOMMENDATIONS

It is important to note that Cadbury was not a typical company in the

eyes of the U.K. public. In addition to producing some of the nation’s most loved
confectionaries, the company had deep, historic roots in local communities.
Kraft’s statement about Somerdale was prominent and significant within this
context and that, as the Panel said, enhanced the importance of the statement.

So I believe, it would be a best way possible for ACA No.2 to be

recommended as an alternative course of action. I’m not saying that Kraft
acquiring Cadbury is bad for the local community of UK, as well as on the
shareholders and workers of Cadbury itself but to put some limitations on these
foreign investors might be a good consideration for UK government, at least, to
establish harmonious relationship between their foreign investors and local
companies. Also, it will be a good act to keep the cultural heritage Cadbury
established on the UK government especially on its local communities. It will
also produce long-term effects of obligations of transparency and accountability
of foreign ownership.