Cadbury’s last stand against Kraft’s £10.4bn ($16.8bn) hostile bid has thrown the onus on the US food group to come up with more cash and make a better offer if it is to succeed in its proposed takeover.

The UK maker of Creme Eggs and Crunchie bars on Tuesday released the second part of its defence against Kraft, issuing healthy 2009 financial figures and laying out reasons why it should remain independent.

There were no surprises in Cadbury’s financial statements – analysts said they had expected the relatively good figures, including underlying sales growth of 5 per cent and operating margin growth of 155 basis points.

But the confectioner stepped up its arguments on why Kraft’s offer, which values Cadbury at about 764p, should be rejected.

It stressed that Kraft’s offer valued Cadbury at just 12 times 2009 earnings before interest, tax, depreciation and amortisation, less than previous deals in the food sector; that the company’s standalone value had increased in recent months because of strong trading in 2009; and that share prices of Cadbury’s peers in the food industry had risen by some 12 per cent since Kraft’s initial approach in late August.

Roger Carr, Cadbury’s chairman, said: “This company is in very good health . . . there is no reason to be owned by anyone else at all, unless they pay a very large premium.”

Mr Carr said Cadbury’s new profit margin targets, which aim for margins of 16-18 per cent by 2013, were “stretching but credible” because the company had brought in consultants to draw up “continuous improvement programmes” (which involve making its factories more efficient) to make sure it hit them.

Todd Stitzer, Cadbury’s chief executive, said investors were better off owning shares in a focused, pure-play confectionery company than a food conglomerate operating in “low-growth, low-margin, private-label categories”.

“Kraft’s model is not a productive model, commercially or financially,” Mr Stitzer said.

Cadbury’s shares on Tuesday closed down 4p at 777p. Analysts attributed the drop to concerns that Kraft might not succeed in its takeover attempt.

Andrew Wood, analyst at Bernstein Research, said: “Should Kraft not significantly raise its bid, we would expect that Cadbury shareholders would not accept the offer.”

Analysts said an offer of £8 from Kraft may not be enough to bring Cadbury’s board to the negotiating table, and it might need to come up with a bid closer to 850p before a Takeover Panel deadline on January 19. Graham Jones, analyst at Panmure Gordon, said: “The issue is how ballsy Kraft will be.”

Mr Jones argued that Kraft could “easily afford” to come up with 850p by lifting the amount of cash in its cash-and-stock offer to 420p from 360p – using some more of the cash from its recent US pizza sale to Nestlé – and make a final offer at 840p.

This would allow it to issue 323m shares instead of the 370m shares initially proposed, potentially satisfying Kraft’s biggest investor, Warren Buffett, who has warned the US company against using too much stock to fund an acquisition.

Cadbury’s argument that food companies were being rated more highly by the market than six months ago was credible because they had survived the recession in relatively good shape and were exposed to fast-growing emerging markets, Mr Jones said.

“We didn’t have the emerging market collapse that some were fearing last year . . . emerging markets are still places to be.”

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