Chiquita shareholders say no to merger with Fyffes

Banana company Chiquita will not enter a merger deal with Irish rival Fyffes after the company’s shareholders voted against it.

The company stated that they are planning to enter discussions with the Brazil-based Cutrale/Safra Group regarding its revised offer to acquire all of the outstanding stock of Chiquita for $14.50 per share in cash.

Speaking about the decision taken by the shareholders, Chiquita president and chief executive officer Edward F Lonergan said: "We appreciate the consideration and perspectives of all Chiquita shareholders who participated in this process. Given today’s results, we have determined to terminate the agreement with Fyffes and to engage with Cutrale / Safra regarding its revised offer.

"I want to thank David McCann and the entire Fyffes team for their efforts throughout this process. While we are convinced they would have been a strong merger partner, we will now go forward as competitors. We would also like to express our gratitude to Chiquita’s employees for their hardwork and dedication on behalf of Chiquita and our customers."

Chiquita employs around 20,000 people and has operations in 70 countries. The company’s annual revenues are more than $3bn.

The BBC stated that with the announcement, the share price of Fyffes decreased 5% to 94 cents in Dublin, while Chiquita’s rose by 3% to $14.16 in New York.

Ahead of the shareholder vote, the Brazilian groups increased their offer by 4%.

According to the Brazilian consortium, the amount offered by them for Chiquita, valued at $682m, was 20% more than the Fyffes bid.

The US-based company also said that it was possible that no agreement with the Brazilian groups would result from the talks.

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Image: Banana company Chiquita has refused a merger deal with Fyffes. Photo: courtesy of Aduldej/freedigitalphotos.net.