Billionaire investor John Paulson has added to his shareholding in Cadbury, as the confectioner battles to stave off a hostile bid from US suitor Kraft.

Paulson, a US hedge fund boss who made billions from the US sub-prime mortgage crisis, has doubled his stake in the Dairy Milk maker to just over 2%.

His company, Paulson & Co, is thought to have paid around £112m for the extra shares, according to The Times.

News of the move emerged after Cadbury earlier this week rejected a £9.8bn formal approach from Kraft – a bid the confectioner’s chairman, Roger Carr, slammed as “derisory”.