PHILADELPHIA (Reuters) – Kraft Foods Inc may raise its offer for British chocolatier Cadbury Plc  or offer more cash in its bid if rival takeover offers emerge, a source familiar with the situation said on Sunday.

Kraft took a $16.8 billion hostile offer for Cadbury to shareholders two weeks ago. Most of the remaining large players in the global confectionery industry -- U.S.-based Hershey Co, Italy's Ferrero and Switzerland's Nestle  -- are now weighing takeover bids themselves, according to Reuters sources and media reports.

Kraft could keep its bid unchanged if no rival bidders emerged, however, a source told Reuters.Kraft "made an offer to start the process," the source said, who declined to be named because they were not authorized to speak with the media. Kraft "never said that was its final offer," said the source,

Nestle was still weighing its options and could decide against a bid, Bloomberg said, citing two unnamed people with knowledge of the matter.

Ferrero and Hershey said on Wednesday they were reviewing a possible offer for Cadbury, while sources familiar with the matter said they were considering a joint bid. Hershey also is weighing a solo $17 billion offer, a source said on Friday.

Italian newspaper Il Sole 24 Ore reported that Hershey executives will meet with Ferrero officials in Italy in the coming days.

Faced with a choice between the two U.S. companies, Cadbury's Chairman Roger Carr said he would prefer a merger with Hershey rather than Kraft. But he added both bids could fail should they not be generous enough.

"Clearly, whilst some potential offers are more aligned with our business model than others, it is the value of the offer rather than the source of the offer that is our priority," Carr told the Sunday Telegraph.

Analysts had viewed Nestle as a potential suitor for Cadbury since Kraft made its offer public on September 7, but such a deal may face antitrust hurdles. The company has also said it does not plan any big acquisitions this year or next, but will focus on a strategy of "bolt-on" buys.

At the same time, the world's largest food maker could easily swallow a large purchase. Nestle said in October it was likely to exercise its option beginning in January 2010 to sell its remaining 52 percent stake in Alcon potentially raising up to $28 billion.

Due to competition issues, analysts had speculated that Nestle might consider a joint offer with Hershey, with the U.S. group taking on Cadbury's chocolate operations and leaving Nestle with the Trident chewing gum business.

Some market players have suggested Nestle could still help Hershey fund a bid by buying its U.S. license for the KitKat brand, potentially worth around $3 billion to $3.5 billion.

Source: Yahoo News sourcing from Reuters