British confectioner Cadbury has agreed to a takeover from US food giant Kraft worth 840 pence per share or STG11.5 billion ($A20.28 billion), the pair said on Tuesday.
"The board of Kraft Foods is pleased to announce the detailed terms of a recommended final offer for Cadbury and the board of Cadbury unanimously recommends Cadbury security holders to accept the terms," a statement said.
The US firm proposes to pay 500 pence in cash and 0.1874 new Kraft Foods shares per Cadbury share. That would value each Cadbury share at 840 pence.
"In addition, Cadbury shareholders will be entitled to receive 10 pence per Cadbury share by way of a special dividend following the date on which the final offer becomes or is declared unconditional," the statement added.
"The terms of the final offer reflect the strength of Cadbury's business, its brands and the future potential for growth through the combination of Kraft Foods and Cadbury."
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