Banana producer Chiquita rejects takeover bid
August 17 , 2014
The US-based banana producing firm Chiquita has turned down a takeover bid by two Brazilian companies Safra and Cutrale, announcing its intention to continue with its planned merger with Fyffes, a European fruit seller.
Cutrale (a fruit juice manufacturer) and Safra (an investment bank) had made an offer of $611m (£363m) for Chiquita earlier this week. Previously, in March 2014, Chiquita and Fyffes had announced their decision to merge their assets, which would result in the creation of the world’s largest banana supplier, with an estimated revenue of $4.6bn annually. This merger would also allow Chiquita to shift its headquarters from the U.S. to Ireland, thus avoiding the relatively higher taxes in the U.S. According to the U.N. the world banana market is dominated by four companies: Chiquita, Fyffes, Fresh Del Monte, and Dole Food Company.
Rejecting the Safra and Cutrale offer, Chiquita commented that the Brazilian offer was "inadequate and not in the best interests of Chiquita shareholders". Meanwhile, following the news of the offer, the value of Chiquita shares has risen 31%.