British confectionery group Cadbury today rejected a takeover bid from US giant Kraft Foods, describing the offer as insufficient.
Cadbury management said it was offering shareholders maximum value by keeping the company independent, notably as it was raising its long-term financial targets.
"Kraft is trying to buy Cadbury on the cheap to provide much needed growth to their unattractive low-growth conglomerate business model," said Cadbury chairman Roger Carr in a circular to shareholders.
"Don't let Kraft steal your company with its derisory offer."
Cadbury said it now foresaw organic growth of 5.0 to 7.0 per cent a year, a profit margin of 16-18 per cent by 2013 and double-digit growth in dividends per share starting next year.
Kraft, which has been repeatedly snubbed by Cadbury management, had appealed directly to Cadbury shareholders with details of its offer, now worth about 9.9 billion pounds (11 billion euros, $16.1 billion) in cash and shares, down from an initial 10.2 billion pounds.
Kraft is the world's second biggest snacks group after Nestle. Cadbury is meanwhile the second largest confectionery company behind Mars.
A tie-up between Kraft and Cadbury would merge leading Kraft brands Oreo biscuits and Maxwell House coffee with Cadbury's Dairy Milk chocolate and Trident chewing gum.