Cadbury US Beverages Sale to "Unlock" Shareholder Windfall
Cadbury-Schweppes' projected sell off it's US drinks division to private equity appears to be advancing on schedule, following the March demerger of the two divisions.
Two rival buyout consortia are being mentioned as the leading contenders: Blackstone, KKR and Lion Capital vs. TPG, Bain and Thomas Lee Partners. Financial analysts are predicting a GPB 5 billion special dividend to shareholders if the ca. GBP 8 billion deal goes through.
Shedding its last remaining non-confectionery brands is also expected to stimulate Cadbury's own hunger for acquisitions, with Hershey, Kraft confectionery, and Ferrero and Perfetti in Italy mentioned as possible targets.
Cadbury without its drinks would be the largest "focused" global Confectionery Company. Swollen with new brands, it would itself constitute a tempting target for a buyout fund to swallow whole. Given the size of recent deals, the deal is completely feasible.