Sumitomo signs agreement to acquire Fyffes for €751m

Irish fruit distributor Fyffes has signed an agreement to be acquired by Japan-based Sumitomo Corporation for €751m.

Sumitomo subsidiary Swordus Ireland Holding Limited will acquire the entire issued and to be issued share capital of Fyffes.

According to the acquisition, Fyffes shareholders will be entitled to receive €2.23 in cash for each Fyffes ordinary share.

The acquisition represents a premium of approximately 49% to Fyffes' closing share price of €1.50 on 8 December.

Sumitomo managing executive officer representative director Hirohiko Imura said: "Sumitomo Corporation has long admired Fyffes for its outstanding track record and market leading position, and we are delighted that the Fyffes Directors have unanimously agreed to recommend our offer to shareholders. We believe that our offer represents a great reward for Fyffes' shareholders.”

“We have significant experience in the produce sector and look forward to working with Fyffes' executive directors, senior management and employees, customers and other stakeholders to strengthen Fyffes' already impressive market position through continued investment. We look forward to working with the Fyffes team to further develop the business over the longer-term and to expanding into new markets to better serve customers."

 Fyffes chairman David McCann said: “We believe this transaction represents a compelling proposition for our shareholders and crystallises the substantial value created in recent years through the various strategic developments and the strong operating performance of our group.

“Our employees, customers, suppliers and joint venture partners will benefit from Fyffes being part of an enlarged group with greater scale, reach and resources to broaden and accelerate delivery of Fyffes' strategic objectives.  We look forward to working with the Sumitomo team to develop and enhance our group's strategy and to build on its long track record of successful growth".

A global trading company with 109 locations in 66 countries, Sumitomo has been active in the banana industry since the 1960s.

With an annual turnover in excess of €1.2bn, Fyffes is headquartered in Dublin, Ireland, with operations in Europe, the US, Canada, Central America and South America and Asia.

The company produces, procures, ships, distributes and markets bananas, pineapples, melons and mushrooms under brands such as Fyffes, Sol, Turbana, Hoya, Highline and All Seasons.

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Image: Sumitomo Group currently imports around 30% of the bananas into Japan. Photo: courtesy of 9comeback via freedigitalphotos.net.