Kraft takeover of Cadbury: the terms
Agreement has been reached between Kraft and Cadbury on an £11.5bn takeover of the 200 year old British confectioner.
After a six month battle, Cadbury's board has - in fraught negotiating overnight - accepted a bid price of 840p per share, valuing the business at £11.5bn.
This will consist of 500p in cash - meaning that Kraft is borrowing around £7bn to finance the deal - and the rest in Kraft shares.
Cadbury shareholders will also receive a dividend of 10p.
Bankers are working frantically to put the finishing touches to the paperwork. An announcement will be made by lunchtime - and possibly as early as 9am.
The increase in borrowings to finance the bid is designed to placate Kraft's biggest shareholder, Warren Buffett's Berkshire Hathaway - which had said that it did not want Kraft issuing too many new shares, since it regarded these as under-priced.
However the increase in Kraft's debt to pay for Cadbury will doubtless worry its employees.
Kraft is likely to give a commitment to protect British jobs for some years in Somerdale and Bourneville. But there are bound to be job losses at Cadbury's Uxbridge head office.
Also, Cadbury employs just 5,600 in the UK and Ireland. The future of a further 40,000 staff outside the UK may be uncertain.
UPDATE 16:07:Few would argue that Britain's economic future depends on whether we make our own chocolates.
But in recent years overseas buyers have bought a far bigger chunk of the British economy than of other developed economies such as the US or Germany or France.
There was a time when British ministers took pride in that - because it brought superior managers to the UK.
And there was a conviction, which may have been wrong, that those who sold their stakes in British business would re-invest the proceeds here.
Today however there are growing fears that there will be a price for Britain from what some see as the surrender of control over our economic destiny.
So for example when Kraft is choosing to create jobs or make important investments, its instinct is likely to be to favour its home territory of the US rather than Britain.
And when Kraft has business to offer to suppliers or consultants, it may have a tendency to favour American firms.
In favouring its compatriots, Kraft would be doing only what comes naturally.
Which is why the ownership by foreign interests of so many British industries - from motor cars to steel to nuclear power and telecoms, among others - may in time reduce the productive capacity of the UK, and make us all a bit poorer.