Cadbury Bids For Soft Drink Companies

Confectionary conglomerate Cadbury Schweppes PLC confirmed Monday it wants to become No. 3 in the U.S. soft drinks business with a cash buyout of Dr Pepper-Seven-Up Cos. Inc.

Cadbury would not say how much it expects to pay, but the company will ask shareholders for $800 million to help fund the deal.

There was no immediate comment from Dr Pepper, which thus far has given Cadbury’s overtures a chilly response - at least publicly.

A purchase of Dr Pepper would give Cadbury a stronger position in the $49 billion a year U.S. soft drinks market, behind giants CocaCola and Pepsi, which have about 70 percent of the business.

Cadbury ranks third in the global soft drinks industry but runs a distant fourth in America, where Dr Pepper holds the No. 3 slot with an 11 percent market share.

A merger would give Cadbury the clout it wants in America and provide Dr Pepper with greater ability to grow internationally.