Nick Clegg and Vince Cable tackle Labour on Royal Bank funding of Kraft's Cadbury takeover (Windsor Liberal Democrats)

Windsor Liberal Democrats <info@windsorlibdems.org.uk>

Nick Clegg and Vince Cable tackle Labour on Royal Bank funding of Kraft's Cadbury takeover

January 20, 2010 11:55 PM

Liberal Democrat Shadow Chancellor, Vince Cable has today written to Lord Mandelson about the takeover of Cadbury by US company Kraft being part financed by the Royal Bank of Scotland.

Commenting, Vince Cable said:

"Cadbury is a national institution which provides thousands of jobs in the UK and there is a real danger its takeover by Kraft will lead to job losses.

"It is particularly galling then that state-owned RBS should part fund this takeover when it is clearly not in the interests of the UK economy.

"This takeover also raises broader questions about how hedge funds, out to make a quick buck, can destabilise even the most established companies.

"We have seen Cadbury shares rapidly bought up by hedge funds that are keen to accept the Kraft takeover regardless of whether it is in the long-term interests of the company.

"As the City minister Lord Myners himself notes, it is becoming too easy for good British companies to be taken over by foreign predators."

Speaking in Parliament Liberal Democrat leader Nick Clegg said it was "plain wrong" the bank was lending money to Kraft, as its takeover could end up costing UK jobs.

During heated exchanges in the House of Commons, Mr Clegg said: "When British taxpayers bailed out the banks, they would never have believed that their money would now be used to put British people out of work. Isn't that just plain wrong?"

He said it was wrong for RBS to lend money to Kraft while British businesses struggled for credit.

Mr Clegg told MPs: "Last month [Business Secretary] Lord Mandelson declared that the government would mount a huge opposition to Kraft's takeover of Cadbury's.

"So why is it that Royal Bank of Scotland - which is owned by this government - should now want to lend vast amounts of our money to Kraft to fund that takeover?"