A new development has been brewing regarding the Cadbury PLC acquisition. According to a regulatory filing released recently, Hedge fund firm Paulson & Co has doubled its stake in Cadbury PLC. Paulson & Co earned billions with sure-fire bets during the credit crisis.

The British regulatory filing also shows that the New York-based hedge fund now owns 28.5 million shares, or 2.08 percent, of Cadbury after it bought 14.8 million shares for 759.59 pence.

The hedge fund’s move in Cadbury was announced right after news came out that U.S. food giant Kraft Foods Inc. would not raise its $16.2 billion offer for the British candy maker. It was reported at that time that Kraft was still lining up its finances for the Cadbury takeover.

However, Kraft still has plans to take its offer to Cadbury shareholders. This may result to a bitter takeover battle that could last months.

About the Paulson & Co, its founder John Paulson ranks as one of the $1.5 trillion hedge fund industry’s best traders. He further made his mark and solidified his reputation by defying conventional wisdom by betting U.S. housing prices could fall on a national scale. With that bet, Paulson became the industry’s highest-paid manager by earning more than $3 billion in 2007.