|Chiquita said it plans to proceed with Fyffes merger.|
CHARLOTTE, N.C. — Chiquita Brands International, Inc. has declined the unsolicited buyout bid it received on Aug. 11 in favor of its previously announced merger with Fyffes P.L.C., Dublin, Ireland.
The Cutrale Group, a juice processing and agribusiness company, and the Safra Group, an investment firm, offered to acquire Chiquita for $13 per share in cash for a transaction valued at approximately $630 million. The two companies said the proposal represented a compelling premium of 29% over Chiquita’s closing share price of $10.06 on Aug. 8.
But Chiquita on Aug. 14 said its board of directors has deemed the bid “inadequate.”
In a letter to the Cutrale Group and the Safra Group, Chiquita said: “After careful consultation with our legal and financial advisers, our board of directors has unanimously concluded that the Cutrale Group and the Safra Group’s offer of $13 per share is inadequate and not in the best interests of Chiquita shareholders. Having made such a determination, Chiquita has determined not to furnish information to, and have discussions and negotiations with, the Cutrale Group and the Safra Group at this time. The board continues to strongly believe in the strategic merits and value provided by the proposed transaction with Fyffes.”On March 10, Chiquita entered into a definitive merger agreement with Fyffes under which Chiquita would combine with Fyffes in a stock-for-stock transaction. On completion, Chiquita shareholders would own approximately 50.7% of ChiquitaFyffes, and Fyffes shareholders owning approximately 49.3% of ChiquitaFyffes. The agreement would create a global banana and other fresh produce company with approximately $4.6 billion in annual revenues if completed.