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 Is Cadbury plc's (NYSE:CBY) chairman Roger Carr regretting blasting Kraft Inc. (NYSE:KFT) for bidding on the company? According to Reuters, Carr is facing pressure to "soften his stance" now that Kraft has until Nov. 9 to come up with a formal bid. With hostile takeovers on the verge of making a comeback and more expected this fall, this kind of begs the question: How is one supposed to act when approached with a hostile takeover? Carr has a lot of experience fighting off hostile bids as chairman of the Chubb plc. and Mitchells & Butlers, and he did negotiate a higher price with Thames Water Utilities Ltd.'s take over of RWE. So he has some experience playing hard to get. But with little chance of a white knight, and Hershey Co. (NYSE:HSY) and Nestle SA wrapped up in legal issues, could Carr be pulling a Jerry Yang, who spurned off Microsoft Corp. (NASDAQ:MSFT) from Yahoo! Inc. (NASDAQ:YHOO) while seeking a better offer? Or would he be pulling a Michael Eisner, the former Walt Disney Co.(NYSE:DIS) chairman who turned down Comcast Corp.'s (NASDAQ:CMCSA) offer? The main difference is how the market reacted and stock recovered. As Deal Journal points out: Kraft simply should wait for Cadbury's defense to play itself out. There is no point in bidding against itself. Even if possible rivals Hershey and Nestlé overcome funding and regulatory obstacles, they likely will wait for Kraft to move first. And if no counteroffer emerges, Kraft may need only a modest sweetener to win over Cadbury shareholders. The alternative: watching the shares slump back toward prebid levels and relying on management promises to boost sales and margins. Still, even with Carr's tough-guy stance, analysts and arbitrage investors expect Kraft to snag Cadbury with at least a little bit of a sweeter offer. Delaying a bid sometimes works, but sometimes it doesn't pay off. For instance, pushing for a higher bid didn't quite work out as planned for Electronic Arts Inc.'s (NASDAQ:ERTS) failed hostile takeover of Take-Two Interactive Software Inc. (NASDAQ:TTWO). So it's likely if Kraft doesn't put a formal offer on the table or Cadbury rejects it again for a higher bid, the candy company could face more lawsuits from shareholders. - Maria Woehr Follow me on Twitter @newsgirlmw Also see: Cadbury downplays shareholder suit Cadbury clears things up, somewhat Could Kraft tell Cadbury to keep its candy?
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