Chiquita Brands International and Fyffes have revised the terms of their deal to merge, in a bid to fend off the takeover bid for the US produce group from Brazilian bidders Cutrale Group and Safra Group.
Under the new terms, Chiquita investors would hold 59.6% of the company, up from the 50.7% they would have received under the original agreement outlined in March.
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If the deal gets the go-ahead from the shareholders of both groups, Fyffes investors would now receive 0.1113 shares in the combined ChiquitaFyffes for each share they hold in the Ireland-based group. Chiquita investors would receive one ChiquitaFyffes share for each share they own in the US company.
The companies plans to merge were thrown into question when Chiquita received an unsolicited bid from juice maker Cutrale and investment firm Safra valuing the business at US$614m.
Chiquita has entered discussions with Cutrale-Safra but continues to support the Fyffes deal.
“We are pleased with the increased value that these enhanced terms for Chiquita bring to our shareholders,” Ed Lonergan, Chiquita’s CEO, said this morning (26 September). “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.”
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By GlobalDataIn addition to upping what Chiquita shareholders stand to gain if they approve the deal, the boards of both companies also agreed to increase the termination fee payable to Fyffes if the merger does not progress from 1% to 3.5% of Chiquita’s total issued share capital.
The deal remains subject to shareholder and regulatory approvals. In the joint statement, the companies added they would delay planned shareholder votes that were scheduled for 3 October. Chiquita shareholders will now vote on the deal on 24 October, while Fyffes investors will be asked to approve the merger on 28 October.
