The takeover of Cadbury by US Kraft in 2010 urged a re-establishment of the rules governing how foreign firms buy UK companies. Many foreign multinational corporations felt that mergers and acquisitions had become too easy for them to buy UK rivals. The Panel of Takeovers and Mergers, which regulates this area reviewed the laws and in September 2011 changes were made to the Takeover Code.

They demanded more information from bidders such as Kraft to reveal their intentions after the purchase, particularly on areas like job cuts. During the process of Kraft bought Cadbury, Kraft promised to keep Cadbury's Bristol Somerdale factory. But Kraft backtracked and said it would close the plant.

Required:

a. Explain how a Kraft manager achieve shareholder wealth maximisation in dealing with this case and any other objectives which are important to a business and need to be considered by using the case of Kraft above.

(6 marks)

b. Identify the members of stakeholder by using case study Kraft merged Cadbury and explain whether such objectives in stakeholder wealth maximisation are consistent with shareholder wealth maximisation. Discuss with other examples to take your arguments.

(6 marks)

c. Define the terms ethics and business ethics and comment your findings from above case study of Kraft. (4 marks)

d. Highlight the factors that might indicate an increased risk of fraud and error in a profit-making company. (4 marks)