Banana giant Fyffes yesterday moved to block another advance from a Brazilian orange juice tycoon trying to turn the head of its takeover partner Chiquita with his own offer.
US-based rival Chiquita agreed to merge with Fyffes in March, but faced doubts on Wednesday when juice magnate Jose Luis Cutrale and billionaire Joseph Safra threatened to attract it with a higher rival bid.
Fyffes chairman David McCann stepped in yesterday by knocking back Cutrale-Safra’s advances.
McCann said the Fyffes merger represented a better deal for Chiquita, working out at between $15.46 and $20.01 a share.
Cutrale-Safra had previously offered Chiquita a sweetened $14-a-share offer for the group, building on a previous flirtation of $13 a share in August.
“Comparatively, a deal with Cutrale-Safra undervalues the company’s potential and represents only a finite value, putting a hard cap to upside for Chiquita shareholders,” McCann said.
Fyffes fell 3.83 per cent in trading while Chiquita also fell 1.19 per cent after the rejection.
The long running banana saga has already seen Fyffes and Chiquita’s merger terms change. Chiquita agreed to take a bigger stake of about 60 per cent in the combined company, instead of 51 per cent agreed in March.
The combined company is set to list in New York and will be called ChiquitaFyffes if the merger succeeds.
It will be the biggest banana bunch on earth with sales of $4.6bn. The iconic Fyffes and Chiquita stickers attached to bananas are set to remain on the fruits, with the ChiquitaFyffes brand used in the corporate arena.