LONDON (Alliance News) - Cutrale-Safra Friday has hit back against Chiquita Brands International Inc's rejection of its sweetened USD14 per share offer, urging Chiquita shareholders to vote against the "inferior" merger with London-listed Fyffes PLC.
Chiquita rejected Cutrale-Safra's Thursday, saying it believed it 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, at general meetings scheduled for October 24. Last Friday, the High Court of Ireland granted its approval for the revised merger deal.
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.
Cutrale-Safra accused Chiquita's board of "significantly deceiving and misleading Chiquita shareholders about both the Cutrale-Safra definitive offer and the Fyffes transaction," and called its rejection a continuation of its "track record of value destruction."
"Further, Chiquita?s gross exaggeration of the value of the Fyffes transaction runs counter to the lower value that the investment marketplace has placed on that transaction," Cutrale-Safra said in a statement.
Cutrale-Safra said that it is submitting a letter confirming that its offer will be binding until two days after the special meeting, and if Chiquita shareholders vote against the Fyffes transaction, they have "every assurance" that Cutrale-Safra's offer will be available.
Cutrale-Safra also attacked the implied present value of the future share price range for the combined ChiquitaFyffes, and Chiquita's projected sales and earnings for its fourth quarter.
"The Chiquita board, through its actions, has demonstrated that its true objective is not serving the best interest of Chiquita shareholders, but rather entrenching itself through the Fyffes transaction,? Cutrale-Safra said in the statement.
Shares in Fyffes closed up 0.1% at 78.32 pence Friday.
By Hana Stewart-Smith; hanassmith@alliancenews.com; @HanaSSAllNews
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