Cadbury to Cut Jobs and Sell Beverage Unit

LONDON, June 19 — Cadbury Schweppes, the biggest candy maker in the world, said today that it planned to cut 7,500 jobs and sell the United States beverage unit that made Dr Pepper, Snapple and 7-Up to become more profitable.

Cadbury, which makes Trident gum and Dairy Milk chocolate, said it had received “expressions of interest” for the drinks unit without giving further details. Cadbury, which in March announced plans to split off its soft drinks business to focus on its candy operation, will eliminate 15 percent of the remaining jobs by 2011 to increase its margins, which have lagged behind those of rivals Hershey and Wm. Wrigley Jr.

Cadbury has received offers from at least three bidding groups that include the private equity firms Bain Capital Partners and Blackstone Group, and Cott, a Canadian company that makes private-label drinks for retailers like Wal-Mart Stores, according to people close to the company.

By focusing on its candy business, Cadbury aims to increase revenue up to 6 percent a year, raise its margins to about 15 percent from 10 percent, lift dividends and improve returns from the capital it invests, it said.

“We have to show we can keep growing the top line while improving margins,” Todd Stitzer, the chief executive, said.

Shares of Cadbury had underperformed those of its rivals after a number of mishaps over the last year at its confectionery unit that forced the recall of thousands of its chocolate products. But the shares started to recover this year, rising 28 percent as investors applauded the separation of the two businesses and Nelson Peltz, the shareholder advocate who pushed H. J. Heinz’s management into selling some assets, said he had amassed a 3 percent stake in the company.

This month, Cadbury expanded its candy business by agreeing to buy Intergum of Turkey for $450 million and a majority stake in Kandia-Excelent, a Romanian confection maker. It said it also planned to buy Sansei Foods Ltd., a Japanese maker of sweets. The sale of the American beverage unit, which also makes Canada Dry and Hawaiian Punch, would follow that of the European drinks business last year to Blackstone and Lion Capital for $2.2 billion. Following the separation, Cadbury will drop Schweppes from its name.

Cadbury’s American drinks business controls about 15 percent of the American market for carbonated soft drinks and ranks behind Coca-Cola and PepsiCo, which share about 74 percent of the $70 billion market, according to Beverage Digest.