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* Ferrero eyeing Cadbury’s candy, gum business – paper

* Traditionally not keen on sharing management – paper

* Ferrero still evaluating all options – source

LONDON/MILAN, Nov 20 (Reuters) – Cadbury (CBRY.L) suitors
Ferrero and Hershey (HSY.N) would likely break the UK
confectioner up into separate businesses if a mooted bid for the
company succeeds, an Italian newspaper reported.

Italian chocolate maker Ferrero and U.S.-based Hershey said
on Wednesday they were reviewing a possible offer for Cadbury,
which is the subject of a hostile 9.9 billion pound ($16.5
billion) bid by U.S. food group Kraft (KFT.N).

Unlisted Ferrero is mainly interested in Cadbury’s gum and
candy division, a unit worth about 5 billion euros ($7.4
billion), business daily Il Sole 24 Ore said on Friday. It said
the family that controls the Italian firm has historically shown
little interest in sharing management.

A source close to Ferrero told Reuters on Friday the company
was still evaluating all options concerning Cadbury. Any bid
would have to be friendly, an Italian source close to the matter
had said on Thursday.

A London trader said traditionally conservative Ferrero
would not want to go hostile and would prefer to proceed with
the support of Cadbury’s board.

A friendly offer would also give Ferrero access to Cadbury’s
books so it could do due diligence, something its financing
banks may demand because the company is not active in the gum
and candy market, the trader said.

A Ferrero spokesman declined to comment.

The Ferrero family should meet advisers Mediobanca (MDBI.MI)
and Rothschild in coming days to discuss a possible deal, the
newspaper said.

Ferrero has about 2 billion euros in cash that could be used
in a bid, it added.

Italy’s two biggest banks, Intesa Sanpaolo SpA (ISP.MI) and
UniCredit SpA (CRDI.MI), could be among those interested in
financing the deal, the newspaper said. The banks declined to
comment.

However, Ferrero would like to take on little debt in a
possible takeover, Il Sole 24 Ore said. Bank financing would pay
for about half of Ferrero’s bid.

Newswire Dow Jones cited people with knowledge of the
situation as saying Ferrero and Hershey are still deciding
whether to bid for all of Cadbury or only a large stake.  Continued…