It has been reported that US firm Kraft is under investigation process by UK regulators into whether it misled Cadbury employees and investors during the battle to acquire the confectioner.

The Wall Street Journal posted that the City takeover panel was pondering into Kraft's claims that the Somerdale factory would stay open if a buyout was successful.

After the deal was concluded, Kraft revealed that the factory, near Bristol, would close by 2011, costing 500 jobs.

However, both Kraft and the takeover panel preferred to remain silent on the report.

The US food giant has grabbed strong rebuke from workers and Business Secretary Lord Mandelson for altering its decision on keeping open a Cadbury factory near Bath, which is now set to close with the loss of hundreds of jobs.

The Chairman of the business committee, Peter Luff, had revealed that MPs seek to know why Kraft turned back on its pledge, and wanted it to clarify its position.

Cadbury is revealed to already spend £100 million on developing new facilities in Poland and most production would be transferred by the middle of this year.