The chairman of candy maker Cadbury PLC said Saturday that Kraft Foods Inc. undervalued his company in a takeover offer this week, and he dismissed the suitor as a "low growth conglomerate."
Roger Carr laid out his opposition to Kraft's $16.7 billion bid in an open letter to Kraft CEO Irene Rosenfeld.
Kraft, the world's second-largest food maker, announced its cash-and-stock offer on Monday. Since then, Kraft shares have fallen about 7 percent, which Carr said made Kraft's bid an "uncertain value" for Cadbury shareholders.
Cadbury's board told Kraft of its opposition to a bid on Aug. 31, and Carr said nothing that Rosenfeld has said since then changed that view.
Carr said Kraft was asking his shareholders to give up ownership in a pure-play confectionery company for Kraft and its "considerably less focused business mix and historically lower growth."
The Cadbury chairman said that under Kraft's offer, "Cadbury would be absorbed into Kraft's low growth, conglomerate business model, an unappealing prospect" that contrasts with Cadbury's strategy to focus on making and selling sweets. Cadbury spun off its U.S.-based beverage company last year.