) -- Union workers want
( KFT) to promise that it will not layoff
( CBY) workers if a takeover attempt of the company becomes successful.
The union leaders at Unite -- Cadbury's union, and one of the UK's largest union groups in the food industry -- are growing increasingly concerned that a takeover will lead to massive redundancies. The union recently met with Kraft managers, but left the meeting disillusioned with the company's lack of guarantees over job safety at Cadbury.
In a move to push Kraft for answers, Unite has expressed its concerns in a letter sent out to Kraft's chief executive, Irene Rosenfeld.
Writing to Irene Rosenfeld, Jennie Formby, the union's national officer for the food sector, says: "Cadbury is a successful, profitable company that provides high quality jobs for more than 6,000 employees in the UK and Ireland, and to date nothing has been said by Kraft to allay the concerns that we have about the potential threat to jobs and conditions should a takeover bid be successful...."
"I have to say that I can not accept this; you clearly have enough information to persuade you to make a bid worth £10 billion and, as we pointed out in the meeting, in the context of the overall bid the assurances we are seeking are not a major commitment on the part of Kraft."
"Our major concern is to understand how you would achieve the quoted savings of $625 million (which some analysts believe will need to rise to as much as £1.5billion) without significant restructuring involving the loss of jobs and sites."
The market has been frowning on Kraft and other leading food companies in early afternoon trading. Its stock are trading down 0.5% at $26.50. Its target Cadbury is also faring in negative territory, down 0.6% at $52.90. Potential Cadbury suitor
is seeing its stock heading 0.7% lower to $35.40.
Bank of America
are getting ready to lend Hershey about $7 billion to launch a bidding war for Cadbury, according various media reports. Meanwhile, shares of
, rumored to be another interested potential suitor, have tumbled 2.10% to $47.30.
-- Reported by Andrea Tse in New York
Follow TheStreet.com on
and become a fan on
Copyright 2009 TheStreet.com Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed