Kraft Foods Inc does not need to sell operations like Oscar Mayer hot dogs, Maxwell House coffee or any of its other brands to afford its $16 billion bid for British confectioner Cadbury , Kraft said on Tuesday.

The financing for this proposal does not require any divestitures, Kraft spokeswoman Perry Yeatman said.

Yeatman was responding to a report on Tuesday in the New York Post that said Kraft, the world's second-largest food company, could sell assets to finance its bid for Cadbury. The report cited sources familiar with the matter.

Kraft's bid was originally worth $16.7 billion (10.2 billion pounds) when it disclosed its proposed offer on September 7, though a decline in Kraft's share price has since lowered the value of that cash-and-stock bid.

Cadbury has rejected the offer, with Chairman Roger Carr saying the prospect of being absorbed into Kraft was unappealing.

Under your proposal, Cadbury would be absorbed into Kraft's low growth, conglomerate business model, an unappealing prospect which contrasts sharply with our strategy to be a pure play confectionery company, Carr told Kraft CEO Irene Rosenfeld in a letter seen by Reuters over the weekend.

Analysts have said that Kraft will likely have to raise its bid in order to get a deal with Cadbury.

Kraft has maintained it will be disciplined in its pursuit of Cadbury and that it wants to maintain an investment grade credit rating, a strategy that could limit how much higher it is willing to go with its bid.

Investors will watch closely on Wednesday when Cadbury Chief Executive Todd Stitzer speaks at a Sanford Bernstein conference in London, where he is expected to be quizzed on his defense strategy for Cadbury.

Kraft shares were down 1 cent at $26.10 on the New York Stock Exchange early Tuesday afternoon. Cadbury shares closed up almost 1 percent in London.

(Reporting by Brad Dorfman; Additional reporting by Santosh Nadgir in Bangalore; Editing by Dave Zimmerman and Richard Chang)

Cadbury