The French Group Danone is the star of a hot summer deal, as it has been offered by Kraft Foods $7.2 billion for its LU cookie unit. Kraft Foods it the world’s largest cookie maker; this buying would mean the company’s expansion in European. As for Danone,  the money would come in a period when they need it for its acquisitions, although some annalists said that Danone’s healthy balance sheet would not require this selling.

However, the amount of money offered by Kraft Foods to the French world’s biggest yoghurt company was unexpectedly high, the previous media reports saying about 3.5 – 4 billion euros. One should also notice that Danone’s LU, which makes the Crème Roulee and Petit Ecolier cookies, sold of 2.2 billion Euros. But for Kraft Foods the unit would give the company the biggest market share in Poland, Italy and France, as through this maneuver Kraft Foods seeks expansion outside the United States.

LU cookies unit has not represented for Danone a priority because the company has focused till now on its specific products Danacol and Activia yoghurts and also on emerging-market beverage sales, which are growing faster than the cookie unit. On the other hand Kraft Foods represents the world’s leader of the biscuit market and it seeks growing stronger on the European market. Last year the American company made sales in the European Union of about $6.7 billion, out of its total of $34.4 billion. $5 billion of the group’s sales are represented by biscuits’ sales.

Kraft Food’s top selling cookie brands include Chips Ahoy!, Oreo and others. Its agreement with Danone will be profitable for both the companies, taking into account that Danone’s development focuses on its specific products and that the agreement would make out of Kraft a strong presence on the European market. However, since Kraft made its proposal official, Danone’s shares rose as much as 4.2 percent.