Cadbury's deal sparks call to reform UK takeover laws
Union leaders in the UK will call today for company takeover laws to be strengthened in the wake of the sale of Cadbury’s to US food giant Kraft.
The controversial takeover will be examined by MPs on the Business Select Committee, who will question executives from both firms as well as officials from the Unite union.
Unite has warned that the multi-billion pound takeover has left a question mark over the future of thousands of Cadbury’s workers, especially as the US changed its mind about keeping open the Somerdale factory near Bath.
Kraft had said it would keep the plant open, but later changed its mind, saying it will close after all, with the loss of 400 jobs.
Jack Dromey, Unite’s deputy general secretary, who will give evidence to the committee today, will call for the introduction of a “Cadbury’s Law” aimed at preventing hostile takeovers of British companies which are not in the public interest.
“This is the first time that Kraft – a debt-laden American multi-national - has been called to account over its actions which saw the company mislead Cadbury workers and the public, and break its promises over closing plants within seven days.
“Kraft must now give cast-iron guarantees that it will guarantee the jobs, the prosperity and economic future of this world-class British company which has been a role model in promoting the welfare of its employees over the decades.”
Jennie Formby, national officer of Unite, added: “There is a great deal of uncertainty amongst the 6,000-strong workforce and Kraft need to reassure them as to their future employment.
“Already Kraft is pressing ahead with plans to shut the Somerdale plant with the loss of 400 jobs and it also announced plans to cut 150 administration jobs. This is a disgraceful betrayal.”
