Workers at the site in Keynsham were told nearly two years ago that the plant would close by early 2010 under plans to switch production to Poland and Cadbury's iconic chocolate factory in Bournville, Birmingham.
But Kraft has revealed it wants to keep open the facility and "undo" some of the streamlining being undertaken by Cadbury should its takeover hopes succeed.
While a deal between Cadbury and the owner of Dairylea and Terry's Chocolate Orange is far from certain, the news will rekindle hopes that Somerdale could yet survive the axe.
Staff, residents of the local community and unions have led a high profile battle against the decision to close the factory.
The fight looked to be in vain after Cadbury stuck by its plans despite alternative proposals by unions being put forward during an initial three month consultation.
Unions ended their campaign to reverse the decision in February after workers voted to stop the battle, although the local community fought on, with residents staging a protest outside Cadbury's annual shareholder meeting in London.
The Somerdale factory has a long history in the confectionery world, originally built by the Fry family - the makers of Fry's Chocolate Cream, who later merged with Cadbury.
The factory has been making Fry's chocolate bars since 1919, but now also makes favourites such as Curly Wurly and Crunchie.
Cadbury's production restructuring is also impacting around 200 staff at the historic site at Bournville, Birmingham.
The planned job losses have come as part of a major overhaul announced by Cadbury in June 2007 to trim around 15% of its global workforce and factories, equivalent to around 7,800 jobs.
But takeover suitor Kraft said it aimed to invest further in Bournville, "preserving UK manufacturing jobs".
The company said: "Our current plans contemplate that the UK would be a net beneficiary in terms of jobs. For example, we believe we would be in a position to continue to operate the Somerdale facility, which is currently planned to be closed, and to invest in Bournville, thereby preserving UK manufacturing jobs."
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