Kraft’s recent $16.7-billion bid for Cadbury continues to make headlines following the latter’s public dismissal of the proposed acquisition.

On Sept. 7, Northfield, Ill.-based Kraft Foods, Inc. announced its cash-and-stock offer.

Shortly thereafter, Cadbury Chairman Roger Carr sent an open letter to Kraft CEO Irene Rosenfeld opposing the bid, saying that his company “would be absorbed into Kraft’s low growth, conglomerate business model, an unappealing prospect which contrasts sharply with our strategy to be a pure play confectionery company.” Carr also referenced an Aug. 31 letter in which he told Rosenfeld that his board rejected the “unsolicited proposal on the grounds that it is unattractive and fundamentally undervalues Cadbury.

“Your proposal is for Cadbury shareholders to exchange shares in a pure-play confectionery business for cash and shares in Kraft, a company with a considerably less focused business mix and historically lower growth,” Carr continued, adding that “the proposal is of uncertain value for Cadbury shareholders as underlined by the movement in the Kraft share price since your announcement.”

Kraft’s offer included $12.22 for every Cadbury share - a 31% premium to its closing price at the time, according to Forbes magazine.

Since Kraft’s proposal, its shares have fallen about 7%, the Chicago Tribune reported.

At a recent investor conference, the Tribune further quoted Rosenfeld as saying that combining the two companies would strengthen Cadbury and give Kraft a boost in developing countries as well as increase Kraft’s earnings.

At the moment, it would seem that Britain-based Cadbury has no intentions of entertaining further offers from Kraft, but only time will tell.

For now, Cadbury CEO Todd Stitzer stands by his board’s assessment of Cadbury’s worth. As he asserted in a Sept.16 presentation to investors, “Cadbury is a great company. The combination of our brands, our market positions, our people and our heritage is truly unique.”

In a world full of acquisitions and mergers, including the one between Mars and Wrigley just last year, this recent bid isn’t a big surprise. However, Kraft may have underestimated Cadbury’s worth, analysts note. Some say that the acquisition of Cadbury would actually pose a deficit for Kraft.

Meanwhile, Kraft estimates that “the deal would save up to $625 million a year in marketing distribution and product development costs,” according to Forbes.

Cadbury brands include Dentyne gum, Hall’s cough drops, Cadbury Dairy Milk and several other candy and chocolate products. Packaged foods producer Kraft is the maker of Toblerone chocolate. For more information, visit www.cadbury.com and www.kraftfoodscompany.com.