WASHINGTON (Alliance News) - Wynnefield Capital, a long-term holder of Chiquita Brands, owning 1.65 million shares or 3.5% of the company, said it rejects the Fyffes PLC transaction backed by the Chiquita board as offering inferior value, and that it supports the recently announced USD14.00 per share offer made by the Cutrale-Safra Group.
Wynnefield projects that Chiquita's shares would fall by USD2.00 - USD2.50 if the Fyffes transaction were approved.
At the same time, Wynnefield's analysis demonstrates that the all-cash Cutrale-Safra proposal would provide superior value and eliminate the risks associated with a merger.
As a company analysed on a cash-flow basis, rather than on Earnings per Share basis, Chiquita Brands would be a better company for all stakeholders as a private enterprise.
Wynnefield believes that the Chiquita Brands board of directors failed to carry out its fiduciary duties by agreeing to the inferior Chiquita-Fyffes transaction, which favours Fyffes shareholders over Chiquita shareholders.
This view is shared by the investment markets, which traded down the share price of Chiquita Brands until the initial announcement of the Cutrale-Safra proposal, it added.
Fyffes shares were up 0.4% to 0.992 pence on Monday.
Copyright RTT News/dpa-AFX
