Can Kraft CEO pass on Cadbury chocolate?

By Brad Dorfman and David Jones - Analysis

CHICAGO/LONDON (Reuters) - Can Kraft Foods Inc Chief Executive Officer Irene Rosenfeld survive without a chocolate fix?

Two months after Kraft publicly declared its proposed bid for Cadbury Plc -- now worth about $16.36 billion (9.85 billion pounds) -- Rosenfeld faces a Monday deadline to decide whether to proceed with a formal offer or walk away for at least six months.

Deal watchers expect Rosenfeld to keep her hand in the game. But they question how much she can risk in her pursuit of the British chocolatier, either by making her bid too sweet or by losing a chance to dominate a faster-growing market.

"Irene Rosenfeld's credibility as Kraft's CEO is at risk if the deal doesn't go through, given that it has been played out so publicly," said analyst Warren Ackerman at brokerage Evolution Securities.

Rosenfeld, ranked as the second most powerful American businesswoman by Fortune magazine, has increased investment in Kraft's marketing and product development during her three years as CEO. She has tried to overhaul a corporate culture that often had businesses operating in silos rather than as one team.

But Cadbury would be by far her biggest deal to swallow, after buying Danone SA's biscuits and cereal business for $7.82 billion in 2007.

"Obviously, Kraft needs Cadbury a lot more than Cadbury needs Kraft," said Lee Linthicum, global packaged food research manager at Euromonitor International.

Just this week, Kraft disappointed investors with quarterly revenue that fell short of expectations and took down its annual sales growth forecast [ID:nN03421549] -- living up to the moniker of "low-growth conglomerate" slung at the company by Cadbury Chairman Roger Carr.