A “slow growth” quarterly report from US multinational Kraft Foods has thrown doubt on the future of the global food industry’s biggest takeover deal.

Kraft’s latest result forecast a disappointing 2% organic growth in revenues for 2009, while earlier its takeover target Cadbury is predicting 5% growth after a rise of 7% in the third quarter.

The contrast between the two companies shows the rationale behind Kraft’s bid – which has to be lodged formally by next Monday under UK rules – but also raises questions about whether Kraft can afford the price.

The original bid, signalled in September, was worth some £10 billion ($US16.7 billion) in cash and stock, and is fiercely opposed by Cadbury. Observers say the price will have to rise or contain more cash for the bid to succeed, given Cadbury’s better performance.

Kraft's organic sales growth in the third quarter was 0.5% – the fourth consecutive quarter in which sales have fallen short of expectatiuions.

Meanwhile Cadbury, which a couple of weeks ago unveiled an upbeat report on its chocolate and chewing gum sales, has shown more than 6% growth over the past few years.

Back in September, Cadbury chairman Roger Carr dismissed Kraft as a "low-growth conglomerate" when rejecting the initial takeover approach.

Kraft’s chief executive, Irene Rosenfeld, says the company remains interested in the bid "but will maintain a disciplined approach."

UK takeover regulations require Kraft to launch a formal takeover by November 6, or walk away for six months.

The original offer values Cadbury at 732p a share but analysts say a serious offer will need to be pitched above that at 780p to 870p.

Kraft’s share price fall after its latest result won’t help while shareholders will fear a sharp drop in Cadbury shares if Kraft calls off the bid. No other bidders have entered the market for Cadbury.