Kraft 'plans $4bn bond sale to fund Cadbury takeover'

4 February 2010

US food giant Kraft is planning a $4 billion bond sale to help pay for its $19 billion takeover of British chocolate manufacturer Cadbury, it has been claimed.

A company insider told the Financial Times that the offering would be done in four tranches of $1 billion each, with different maturity dates attached to each one.

It was also suggested that Kraft will be seeking to sell off more debt in foreign currencies as part of its fundraising efforts.

In order for its takeover bid for Cadbury to be successful, Kraft had to up its original offer and promise a higher percentage of the takeover funds will be paid in cash – increasing the company's debt load.

According to the terms of the deal, 60 per cent of the $19 billion will be paid in currency, with the rest coming in the form of shares.

Last month, Warren Buffett, Kraft's largest shareholder, launched an attack on the buyout, telling CNBC he would have voted against the deal had he been given the opportunity.

By Tony Aynsley

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