By Kate Haywood and Romy Varghese Of DOW JONES NEWSWIRES NEW YORK -(Dow Jones)- The number of banks involved in the financing for Kraft Foods Inc.'s (KFT) bid for Cadbury PLC (CBY) could expand to 18, a person familiar with the matter said Friday. The bridge loan is estimated to be GBP5 billion to GBP5.5billion (about $9 billion), and is arranged by Citigroup, Deutsche Bank and HSBC. A further six banks will join the leading trio, including BNP Paribas, Barclays Capital, Royal Bank Of Scotland and Credit Suisse, according to several people familiar with the matter. The leads are expected to cast the net even further, one of them said, with Mizuho and Calyon also likely to be among the banks playing a role. Corporate bonds would replace the bridge loan, with the banks likely to sell the bonds in several different currencies, tapping the dollar, euro and sterling markets. This would match any new debt with the revenue bases of the merged entity, as well as with the existing currency mix of both Cadbury and Kraft's capital structures. Under U.K. law, Kraft, of Northfield, Ill., must make a formal offer for Cadbury by Monday or walk away for six months. In September, Cadbury immediately rejected Kraft's cash and stock bid, then valued at $16.7 billion (GBP10.2 billion). While Kraft's decision to pursue Cadbury was met by stockholders without enthusiasm, judging by Kraft's falling shares, banks have been eager to extend funds. The relationship would lead to lucrative business with the merged company, such as future loan facilities, share sales, mergers and acquisitions and refinancing mandates further down the line. Kraft shares are recently trading at $26.70, about a 5% drop from before the bid was announced. Kraft couldn't immediately be reached for comment. The banks couldn't be immediately reached for comment. -By Kate Haywood, Dow Jones Newswires; 212-416-2218; kate.haywood@dowjones.com -By Romy Varghese, Dow Jones Newswires; 215-656-8263; romy.varghese@dowjones.com (Carol Dean in London and Anjali Cordeiro in New York also contributed to this article.)
