Cadbury melts to Kraft's takeover offer: report

American food company Kraft Foods is understood to have reached an agreement with Cadbury for acquisition of the British confectioner for an estimated $19 billion, putting an end to the months long takeover tussle between the two firms, media reports say.

According to a report in The Times, the chocolate maker finally surrendered to the foreign takeover which "brings to a conclusion one of the most fiercely contested takeover battles the City (London) has seen in recent years".

Besides, broadcasting major BBC stated that Cadbury has agreed to the takeover after Kraft's board approved a new increased bid.

"The Cadbury board will advise its shareholders to accept new offer of 840 pence a share - valuing the company at 11.5 billion pounds ($19 billion)," the BBC reported.

Moreover, Cadbury shareholders would also receive a dividend of 10 pence a share, the report added.

The offer will consist of 500 pence in cash, with the rest made of Kraft shares. Kraft would borrow 7 billion pound ($11.5 billion) to finance the deal, the report stated.

In September 2009, Kraft Foods had originally tabled a 10.9 billion pound bid for Cadbury.

The bid went hostile in November as Kraft made its proposals directly to Cadbury's shareholders over the heads of its board.

However, Cadbury and its shareholders strongly resisted, obliging Kraft to raise its terms.