Kraft Cadbury Takeover

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AGENDA

• Kraft + Cadbury ( A Strategic Fit).Kraft + Cadbury ( A Strategic Fit).• Recommended Offer: Structure & Economics.Recommended Offer: Structure & Economics.• Conclusion.Conclusion.

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KRAFT FOODS OVERVIEW

NYSE: KFT• Ranking :World’s second largest food company

after nestle .• Brands available in 150 countries.• Headquarter: Chicago, Illinois.• Employees Approximately 100,000• 2008 Revenues $42 Billion.• The firm has two main operating units-Kraft Foods

North America and Kraft Foods International

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KEY BRANDS

• Of its brands, more than 40 are at least 100 years old, nine brands have revenue exceeding $1 billion and more than 50 additional brands have revenues greater than $100 million.

• The company holds the top global position in 11 product categories:

• coffee, cookies, crackers, cream cheese, dessert mixes, dry packaged dinners, lunch combinations, powdered soft drinks, process cheese, salad dressings, and snack nuts.

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SHAREHOLDERS

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FINANCIALS

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KRAFT: Major Priorities (long term strategy)

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CADBURY PLC OVERVIEW

• Ranking: one of the world's largest confectionery companies with No. 1 or No. 2 positions in more than 20 of the world's 50 biggest confectionery markets.

• The largest and most broadly spread emerging markets business of any confectionery company.

• Employees: 48,000.• 2008 Revenues:$9 Billion

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KEY BRANDS

• direct operations in more than 60 countries.

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How we stack upCADBURY KRAFT

SIZE 2nd largest confectionery co after mars -wrigley

World’s 2nd largest food group, after nestle.

BRANDS AND PRODUCTS

Dairy milk and roses chocolates, trident gum and halls cough drops.

Oscar mayer hot dogs, maxwell house instant coffee, milka, toblerone and tang.

REVENUE IN 2008 $8.8 billion $42 billion

EMPLOYEES 46000 98000

FOUNDED IN

HQ

CEO

1824

Uxbridge , london

Todd stitzer

1903

Northfeild , illinois

Irene rosenfeld

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STRATEGIC RATIONALE(KRAFT + CADBURY)

• Geographic break down by 2008 revenues

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TRANSACTION WOULD CREATE

• A company with approximately $50 billion in revenues.

• A global powerhouse in snacks, confectionery and quick meals;

• A geographically diversified combined business, ( including developing markets like India, Mexico, Brazil, China and Russia).

• A strong presence in instant consumption channels in both developed and developing markets.

• The potential for meaningful revenue synergies over time from investments in distribution, marketing and product development.

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COMBINED COMPANY WILL PRESERVE CADBURY’S PROUD HERITAGE AND TRADITION

• mm

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TRANSACTION DELIVERS VALUE FOR KRAFT SHAREHOLDERS

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SYNERGIES AND COST SAVINGS

• Potential for meaningful revenue synergies- Highly complimentary geographic footprint

- Enhanced distribution, marketing and product development

• Additional annual cost savings of $675 million- Pre tax annual cost saving identified as

300 million in operational synergies

250 million in general and administrative synergy

125 million in marketing and selling synergy

- Performance improvement programs at Kraft and Cadbury

- One off implementation cost of $1.3 dollars

Our ability to successfully integrate

Long term targets and near term benefits

SUMMARY

The final offer marked a 14% increase from our initial offer.

Will create the worlds largest confectioner.

Recommended offer represents an attractive offer for Cadbury share holders- Combination of cash and upside as continuing share holders

- Transforms the portfolio and enhances the long term growth prospects

Generates a strong near term economic return- 5% increase in EPS in 2011

- 9%-11% increase in long term

- Access to an iconic brand with a strong penetration in growth markets

- Access to a strong marketing and distribution channel in developing market

RISK ANALYSIS

-- Over exposed to large low growth developed marketOver exposed to large low growth developed market

- A range of products and categories that have competition from A range of products and categories that have competition from various other private companiesvarious other private companies

- Unfocused Business modelUnfocused Business model- Continued weak economic environmentContinued weak economic environment- Global chocolate consumption has fallen by 2%- Integration of business- Higher cocoa prices may pressure chocolate companies to make

acquisitions- Issuance of debt causing our rating to lower