UPDATE 9-Kraft turns hostile in $16 bln bid for Cadbury

* Kraft takes original Cadbury offer hostile

* Values Cadbury at 709p/share vs 745p in Sept

* Cadbury rejects "derisory offer"

* Offer not seen as Kraft's last, investors push for more

* Cadbury shares up 0.4 pct, Kraft falls 0.9 pct (Adds detail from Kraft proxy filing)

By David Jones and Brad Dorfman

LONDON/CHICAGO, Nov 9 (Reuters) - Kraft Foods Inc (KFT.N) chief Irene Rosenfeld refused to sweeten her $16.2 billion offer for candy maker Cadbury Plc (CBRY.L) and took the bid directly to shareholders on Monday, setting the stage for a takeover battle that could last up to three months.

North American food giant Kraft repeated on Monday the cash and shares terms of its original offer, which Cadbury rejected two months ago, and formalized the bid to meet a UK Takeover Panel deadline. The bid is now worth about 5 percent less after a fall in Kraft shares.

Cadbury lost no time rejecting the hostile bid as a "derisory offer," as Chairman Roger Carr termed it. Cadbury investors also said they would not countenance the offer without a substantial sweetener, to at least 800 pence per share from the current deal value of 709 pence per share.