It's only been a little while since Kraft secured the capitalization to buyout Cadbury PLC; and there are already allegations similar to those of when Bank of America merged with Merrill Lynch.
U.K. regulators are looking into comments made by Kraft executives that may have misled those that voted in approving the takeover bid. The alleged comments deal with the closing of a plant that Kraft was originally against. With all of the domestic ill will brewing during the takeover, closing the plant and displacing the jobs won't help endear Kraft to their new countrymen.
I believe that if a company says they are going to do something, they should do it. However, when a company merges with another, there may be unforeseen losses and costs, especially with an international merger. I seriously doubt that they will face severe legal repercussions, but as all companies know,corporate responsibility and public opinion go hand-in-hand.
And since the public affects their bottom line, Kraft should tread very carefully when making future decisions for Cadbury. They took on a lot of debt to finance the acquisition and it would be sad to see it turn into dead-weight over the next decade.
No comments:
Post a Comment