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Editor: Brian JM Quinn
Boston College Law School

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Thursday, January 6, 2011

Kraft closes Cadbury plant at center of controversy

Kraft had promised not to close the Bristol (UK) plant and save the plant's jobs as part of its acquisition of Cadbury. That turned out to be a false promise.  The plant has just closed

Cadbury has confirmed the last bar of chocolate has rolled off the production line at its Somerdale factory in Keynsham. The closure of the plant, which at one stage was one of the biggest employers in the area, marks the end of Bristol's 250-year long association with the chocolate industry...

At its height, the factory employed about 750 people and produced around 52,000 tonnes of chocolates each year, including Crunchie, Caramel, Double Decker, Picnic, Chomps, Mini Eggs and Turkish Delight...

Meanwhile Roger Carr, the businessman who oversaw the £11-billion sale to the US multinational Kraft in February, was knighted for services to industry in the New Year Honours List.  Sir Roger was praised by the City for getting a good deal for shareholders when the Cadbury sale went through in February.

Of course, the workers get shown the door, while Carr gets a knighthood.  I wouldn't expect anything less.  You'll remember that Kraft's promise to save the jobs at the UK plant was an important part of Kraft's public relations campaign to get the deal done.   The broken promise generated political pressure to force a reexamination of the Takeover Rules, now in progress.

-bjmq 

http://lawprofessors.typepad.com/mergers/2011/01/kraft-closes-plant.html

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