Kraft inadvertently changed the landscape for takeover bids in Britain with its hostile pursuit of Cadbury.
The public backlash to the loss of a cherished British brand in the run-up to a general election prompted politicians of every hue to demand a wholesale review of Britain’s takeover regime.
The rhetoric died down temporarily with the formation of the coalition government, who quickly realised they had bigger fish to fry.
But the issue of whether foreign predators should be allowed to launch hostile bids for British companies could be reignited tomorrow when MPs on the Business Innovation and Skills (BIS) Committee grill Kraft’s bosses.
Brian Binley, the Tory MP for Northampton South, told The Times that the over-arching issue of foreign predators is his “keenest concern”.
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But in the background a Takeover Panel review instigated partly at the urging of the former Business Secretary Lord Mandelson is already set to lead to real changes.
The Panel, a venerable City institution that recoils from political interference, issued a dull-sounding, but far reaching set of proposals last October.
Comfortably the most important plan is to force publicly named potential offers either to bid for a company or to walk away within four weeks of an approach.
This may sound like tinkering, but the proposal has huge implications for private equity, which has been lobbying the Panel hard for a U-turn on the issue.
The problem for the Masters of the Universe is that they need to borrow heavily to buy and arranging those loans takes much longer than four weeks. Furthermore, private equity does not do hostile takeovers.
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The industry’s seminal approach — typified by KKR in its £10.6 billion bid to take Alliance Boots private in 2007 — is to run a “shadow” takeover offer over several months, during which they persuade shareholders to sell out.
Under the proposed new regime, this will no longer be possible. Senior industry figures say privately that there will simply be no more take-private bids in the UK if that change is made to the code.
Well-placed observers believe that despite industry lobbying, the Panel will keep this key amendment when it publishes its final word on the matter in the next few weeks.
Should this happen, Irene Rosenfeld will have achieved what no amount of union lobbying did and permanently stopped private equity in its tracks. The irony is that the new regime would not have prevented her from buying Cadbury.