Cadbury’s acquisition causes its credit protection to rise
The cost of credit protection for Cadbury Schweppes widened nearly 20 basis points in trading yesterday. The British confectioner was downgraded following the announcement of its decision to buy Adams, the chewing-gum maker, from US pharmaceutical company Pfizer.
The cost of five-year credit default swaps on Cadbury Schweppes widened 15bp immediately on the news to 73/83bp, trading a few basis points wider at 75/85bp today.
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