retail news in context, analysis with attitude

USA Today has a story saying that the Business Select Committee of the British Parliament is accusing Kraft Foods of acting “irresponsibly and unwisely” in its $17.5 billion acquisition of Cadbury, and has called on the UK Takeover Panel to consider a revision of rules covering the purchase of British companies by foreign entities.

The central issue is a Cadbury factory in Somerdale, which Cadbury - a company with an almost two century British pedigree - had planned to close and move production to Poland; when it was looking to get British regulators’ approval of its Cadbury acquisition, Kraft pledged to keep the facility open, which would have saved some 400 jobs. Alas, once approvals were given and the deal consummated, Kraft decided to close the factory after all...which has led to accusations that it behaved cynically and deliberately lied to regulators.

Kraft CEO Irene Rosenfeld has even come in for some personal criticism for not attending hearings into the matter, which one member of the House of Commons described as a “sizable discourtesy.”

Kraft reportedly has promised not to close any more Cadbury facilities in the UK for the foreseeable future...but politicians there seem unwilling to accept this on faith.
KC's View:
Kraft’s decision to close the factory seems impolitic at best...and it sounds like it could have protectionist implications that could affect moves by it or other companies to acquire other operations in the UK.

I am, by the way, glad I don’t work in the UK. Because I sort of make a living at being “sizably discourteous.”