Kraft Foods said Monday it's pursuing a takeover of Cadbury after the U.K. chocolate maker rejected a 10.2 billion pound ($16.7 billion) bid.

Kraft (KFT) said a combination of the two would create a "global powerhouse in snacks, confectionery and quick meals" with annual sales of more than $50 billion. But analysts suggested the U.S. giant, which is a component of the Dow Jones Industrial Average, may need to significantly raise its offer.