TEXT OF INTERVIEW

Bill Radke: Kraft Foods turned hostile today in its bid for British chocolatier Cadbury. Marketplace’s Stephen Beard is following all this in London. And he joins us live. Good morning.

Stephen Beard: Good morning, Bill.

Radke: Now, Stephen, Kraft made an informal bid for Cadbury back in September. That got rejected. This offer is for less money than the first one. How does that happen?

Beard: Because Kraft is offering a mixture of cash and shares. And Kraft shares have declined since September. Its latest figures have been pretty disappointing, so Kraft’s have dipped making this offer worth less.

Radke: But why didn’t Kraft work to raise its bid? I mean, the first bid was rejected for being too low. Why didn’t Kraft offer more?

Beard: Kraft itself is under itself from its own investors not to overpay for Cadbury. In particular, Warren Buffett, who has a stake in Kraft, has made it clear that $16 billion or so is probably about enough money for the British company. Kraft had to table this official bid today — before the end of today in fact — under British takeover rules. If it hadn’t, it would have to walk away from the bid and not come back for two days. So it seems that the deal here — for six months that is — is that it is now making an official bid. It will now sit back and see whether any rival bidders enter the fray.

Radke: And are there any other signs of rival bidders?

Beard: None so far. Some people say Nestle or even Unilever might join in, but none so far. This is going to be a very interesting month to watch.

Radke: Marketplace’s Stephen Beard, live in London, thank you.

Beard: OK Bill.