LONDON (Alliance News) - Cutrale-Safra on Thursday made another increased bid for Chiquita Brands International Inc, its latest attempt to derail the US company's planned merger with Irish rival Fyffes PLC.
Cutrale-Safra, a joint venture between Brazilian food companies Cutrale Group and Safra Group, said it would increase its bid for Chiquita to USD14.50 per share, up from the USD14 per share which Chiquita rejected a week ago. Chiquita said the USD14 per share offer was "inadequate and not in the best interests of Chiquita shareholders".
Chiquita and Fyffes agreed to merge earlier this year to create the world's biggest banana company, a deal that was cleared earlier this month by the European Commission. The deal is still subject to approval from both of the companies shareholders, with general meetings set for tomorrow.
Under the revised merger terms with Fyffes, Chiquita shareholders are expected to own 59.6% of the combined business, with Fyffes shareholders expected to own approximately 40.4% of the ChiquitaFyffes business, on a fully diluted basis.
Making the new offer, Cutrale-Safra said the USD14.50 per share value of the new deal is a 14% premium to the closing value of Chiquita shares on Wednesday and claimed it represents an effective premium of 20% to the Fyffes deal.
The new offer comes after a series of accusations made by Cutrale-Safra against Chiquita, including the suggestion the board of the US company was "significantly deceiving and misleading Chiquita shareholders about both the Cutrale-Safra definitive offer and the Fyffes transaction" and a claim that Chiquita's rejection of its last bid continued its "track record of value destruction".
Its campaign to block the Chiquita-Fyffes deal was given a boost earlier this week when Wynnefield Capital, a long-term Chiquita shareholder with a 3.5% stake in the company, said it would reject the Fyffes deal and said it supports the Cutrale-Safra rival bid.
Fyffes shares were trading flat on Thursday, quoted at EUR1.015.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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