Kraft Foods has been given until 9 November to come up with a firm offer to buy Cadbury.

The 'put up or shut up' deadline was imposed today by the Takeover Panel and follows the US food giant’s 745 pence a share proposal to buy Cadbury on 28 August.

Cadbury rejected Kraft's approach in a letter dated 31 August. However analysts believe this is only the start of a long bidding war for the British chocolate marker.

"We have made our position on Kraft's proposal very clear and we welcome the panel's decision today in the interests of obtaining clarity and certainty for our shareholders and employees at the earliest opportunity," said Cadbury chairman Roger Carr.