Chocolate groups Hershey, Ferrero eye Cadbury

US chocolate maker Hershey and Ferrero of Italy said yesterday they were mulling a potential counter-bid for British confectioner Cadbury, the object of a hostile offer from Kraft Foods.

The news could remould the chocolate-making sector with a takeover costing more than £10.0 billion (€11.2 billion). The Wall Street Journal, citing unnamed sources familiar with the matter, had reported on Tuesday that Ferrero was in talks with Hershey over a potential joint bid.

The pair said in separate statements to the London Stock Exchange yesterday that they were considering options regarding Cadbury.

"The Hershey Company notes the recent press speculation regarding a potential offer for Cadbury," Hershey said in a statement.

"Hershey confirms that it is reviewing its options and at this stage there can be no assurance that any proposal or offer from Hershey will be forthcoming.

A further announcement will be made in due course if appropriate."

Cadbury's share price rose on Wednesday in reaction to the prospect of a takeover battle.

Ferrero also said it was looking over Cadbury.

"Ferrero notes the recent press speculation regarding a potential offer for Cadbury. Ferrero confirms it is in the preliminary stages of evaluating its options in respect of Cadbury," Ferrero said in its statement.