Chiquita International and Fyffes Announce Revised Merger Deal

By Sarah Price - 26 Sep '14 11:27AM

Chiquita Brands International Inc, the American banana producer and distributor and Fyffes PLC, and the Irish fruit company announced a revised merger deal Friday, which will give Chiquita shareholders a larger stake in the merged company.

Chiquita will have 60 percent control of the new company, up from the previously planned 51 percent while Fyffes will hold the other 40 percent. The new company will be headquartered in Dublin, Fyffes's homeland.

"We are pleased with the increased value that these enhanced terms for Chiquita bring to our shareholders," Ed Lonergan, Chiquita's CEO said in a statement.

"The Fyffes transaction is a natural strategic partnership that brings together two complementary companies to create a combined company that is better positioned to succeed in a highly competitive marketplace, while driving strong performance and value for shareholders as well as immediate benefits for customers and consumers worldwide," Lonergan added.

However, the company asserted that if the deal doesn't acquire full approval from its shareholders by Oct. 24, Fyffes would have the power to terminate the deal. Also, if Chiquita enters into any other agreement with other companies, Fyffes will be entitled to a termination fee.

According to the Associated Press, Chiquita has been in talks of a potential takeover with some Brazilian firms. Earlier this month, Chiquita announced that Fyffes has allowed Chiquita to conduct and consider acquisition talks with other companies.

But teaming up with Fyffes will give Chiquita a lion's share of the banana market.

"The combination of Chiquita and Fyffes is strategic and compelling, creating the #1 banana company globally, with synergies that can only be achieved by these companies coming together," David McCann, executive chairman of Fyffes added in the statement.

"This revised binding agreement, along with the additional synergies recently announced, reinforces our conviction that the Combination is the value-maximizing opportunity for both companies' shareholders."