Merger to create banana behemoth

ChiquitaFyffes will sell more than 160 million boxes of bananas a year. Photo / AP
ChiquitaFyffes will sell more than 160 million boxes of bananas a year. Photo / AP

Chiquita Brands International, the US fresh food giant, and Ireland's Fyffes say they will merge to create the world's biggest banana company.

The transaction will create a combined company valued at US$1.07 billion ($1.26 billion) named ChiquitaFyffes, a fresh produce company with annual revenue of US$4.6 billion, the companies said.

The all-stock deal values the Irish company at US$526 million.

The combined company will become the leading global banana and other fresh produce company, with sales of more than 160 million boxes of bananas a year, they said.

The deal puts together two banana companies that began in the 19th century as modest suppliers and grew into global powerhouses.

Chiquita was founded by Captain Lorenzo Dow Baker, who in 1870 bought bunches of bananas in Jamaica and sold them for a profit in New Jersey.

Fyffes, founded in 1888 as EW Fyffe, Son and Co, launched the first fruit brand in the world in 1929 with its "Fyffes Blue Label" sticker on bananas.

"This is a milestone transaction for Chiquita and Fyffes that brings together the best of both companies," said Ed Lonergan, Chiquita's chief executive.

Chiquita is a leading global marketer and distributor of fresh food products, including bananas and packaged salads. Fyffes is one of Europe's largest tropical produce distributors, mainly bananas, pineapples and melons.

Chiquita shareholders will own approximately 50.7 per cent of the new company, with Fyffes shareholders owning the rest.

The value of the transaction was based on the companies' closing share prices on Saturday and an exchange rate of 1 to US$1.39.

ChiquitaFyffes will have an operating presence in more than 70 countries and a workforce of some 32,000 people.

Lonergan will serve as chairman of ChiquitaFyffes and David McCann, Fyffes executive chairman, will be chief executive. "We are looking forward to working with the Chiquita team to build a combined company which is well positioned to succeed in our highly competitive marketplace and which will create significant value for our shareholders," McCann said.

The merger is subject to shareholder and regulator approvals.

- AFP

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