US conglomerate Kraft Foods has confirmed it is finalising a deal to take over the chocolate maker Cadbury, bringing the four-month battle between the two companies to a close.
Kraft is said to be paying around £11.7 billion in cash and stock for 186-year old Cadbury, which makes Dairy Milk chocolate and Trident chewing gum.
Cadbury, which operates in more than 60 countries and employs over 46,000 people, is the worldÔÇÖs second-largest confectioner after Mars-Wrigley.
The merger with Kraft will create a company with more than £32 billion in annual revenue.
Kraft made its first offer, an unsolicited bid of ┬ú10.9 billion, for Cadbury in September last year. CadburyÔÇÖs management dismissed the offer as being too low, marking the beginning of months of wranglings.
Kraft already owns confectionery brands such as Milka and Toblerone but the company suffers from a poor reputation among many in the food industry because it makes much of its money from processed cheese and meat.
UK politicians and unions have expressed concerns over job losses that could arise from a merger, with the Unite labour union hinting that as many as 30,000 jobs could go.
However, Kraft is likely to commit to protecting jobs at the UKÔÇÖs Somerdale and Bourneville sites, according to the BBC, though staff numbers at Cadbury's head office in Uxbridge are expected to be cut.
A factory earmarked for closure at Keynsham, near Bristol, is also likely to be saved under the terms of the deal.
Kraft bought TerryÔÇÖs, another iconic British chocolate company, in 1993 and closed its York factory two years later.
Cadbury was founded in 1824 in Birmingham. In 1897, the company created its first milk chocolate, introducing Dairy Milk eight years laterÔÇöthe product that remains the companyÔÇÖs best-seller to this day.
The company merged with Schweppes in 1969 to form Cadbury Schweppes, though the two companies parted ways in 2008 when the bulk of the drinks business was sold to Dr Pepper Snapple.
Pennsylvania, US-based confectioner Hershey had been waiting for Kraft, which is five times its size, to unveil its final offer before making a final decision on its own bid. However, it is now deemed unlikely that it will be able to top KraftÔÇÖs improved offer.
Other interested parties included Swiss food group Nestl├® and ItalyÔÇÖs Ferrero, but both companies dropped out of the bidding process.
In a joint statement released this morning, Kraft and Cadbury said: "The boards of Kraft Foods and Cadbury confirm that they are finalising the terms of a recommended offer for Cadbury. A further announcement will be made shortly."
