Shares in Cadbury rose 16.5p to close on 698p yesterday amid rumours that the confectionery giant could be a bid target.

Analysts whispered that US confectionary companies Kraft Foods and Hershey could be interested in making a joint bid, with Hershey taking the chocolate business and Kraft Foods the gum business, said The Times.

US investor Warren Buffett was also linked to the rumours. He has built up a big stake in Kraft Foods and is on a visit to Europe, added the Independent.