National Post (National Edition)
BANANA WARS
Chiquita-Fyffes deal may be split by surprise bid from juice giant and Brazilian investment firm.
HOUSTON/DUBLIN • Chiquita Brands International Inc., owner of the namesake banana label, received an unsolicited US$611-million takeover proposal that envisages the company scrapping its pending merger with Irish competitor Fyffes PLC.
Juicemaker Cutrale Group and Safra Group said on Monday in a joint statement they are offering US$13 a share for Charlotte, N.C.based Chiquita. The proposal is 29% more than Chiquita’s closing share price on Aug. 8 and isn’t subject to financing conditions, Cutrale and Safra said.
The proposed bid jeopardizes the Fyffes merger, which would lower Chiquita’s tax bill by moving its headquarters from the U.S. to Ireland. Cutrale, a privately held company controlled by Brazil’s Jose Luis Cutrale, is partnering with banks controlled by Joseph Safra, Brazil’s secondrichest man, to challenge the Fyffes tie-up.
“To have a new bid at such a high premium come out of left field is quite surprising,” David Holohan, an analyst at Merrion Capital in Dublin, said Monday. “The market clearly is attributing value to the new bid as opposed to the old tie-up between Fyffes and Chiquita.”
Chiquita jumped 30.2% to close at US$13.10 in New York Monday.
Cutrale controls more than one-third of the US$5-billion orange juice market, and also operates in markets for apples, peaches, lemons and
To have a new bid ... come out of left field is quite surprising
soybeans, according to the statement.
“This platform offers Chiquita extensive experience in all aspects of the fruit and juice value chain,” Cutrale and Safra said in the statement.
Safra has more than US$200 -billion of assets under management and operates banks in North America, South America, Europe, the Middle East and Asia, according to the statement.
“If we are able to proceed on a timely basis with due diligence and discussions, we will be in a position to close the transaction before the end of the year, within the same time frame you have indicated for the Fyffes transaction,” Cutrale and Safra said in a letter to Chiquita’s management, a copy of which was included in the statement.
The Chiquita-Fyffes deal, which was announced in March, would bring together two of the world’s oldest fruit importers and operations spanning the Americas, Europe and Asia.
Brian Bell, an external spokesman for Fyffes, declined to comment. Ed Lloyd, a Chiquita spokesman, didn’t immediately respond to a call and email seeking comment.