Banana giant Chiquita grabbed more than its share of attention in 2014 with merger plans that seemed to ebb and flow on an almost-weekly basis, new product offerings, a company relocation and even an accusation that the company lobbied against anti-terrorism legislation.

March 17
Merger creates new top banana
By Coral Beach, Staff Writer

4. Going bananasReducing the world’s top four banana companies to three, the boards of Chiquita Brands International Inc. and Irish competitor Fyffes Plc. have agreed that the Charlotte, N.C., company will buy the Dublin company in an all-stock deal valued at $526 million.

Corporate leaders said in a conference call with analysts that their individual brands will be retained following the merger. They plan to close the deal by the end of 2014. Chiquita shareholders will own 50.7% of the combined company, ChiquitaFyffes, while Fyffes shareholders will have the remaining 49.3%, according to the March 10 news release.

Chiquita president and CEO Ed Lonergan will be chairman of the combined company, and Fyffes CEO David McCann will become chief executive officer. By combining operations, corporate officials project an operational pre-tax savings of at least $40 million by the end of 2016. Most of those savings would be generated in shipping and procurement, officials with the two companies said.

Greater scale and efficiency via a larger, more diversified organization should result in ChiquitaFyffes generating annual banana sales of more than 160 million boxes. The combined company should become the largest global player in the banana category, with the No. 1 position in Europe and the No. 2 position in North America, McCann said in a conference call with analysts on March 12. The company will be able to offer branded, private label, organic and Fair Trade fruit, McCann said.

The new company is expected to be worth about $4.6 billion in annual revenues.

 

March 24
ChiquitaFyffes plans key role for Fresh Express
By Coral Beach, Staff Writer

The Fresh Express packaged salad line from Chiquita Brands International Inc. is a key element in the “turnaround strategy” for the banana giant as it acquires and merges operations with Fyffes PLC of Dublin.

“Fresh Express will be a very important component to the overall success of the combined company,” said Ed Loyd, director of communications for Chiquita, Charlotte, N.C. “We see this business as a critical growth engine for the combined company going forward for the top line and bottom line.”

Chiquita reported a net loss of $16 million in 2013, down from a $405 million loss in 2012. The company’s operating income was $50 million for 2013, up from a $254 million loss in 2012.

Chiquita is naming Brian Kocher as chief operating officer of salads and healthy snacks to lead the Fresh Express operations, Loyd said.

Kocher has been on the Chiquita executive staff since 2005 when he was hired as president of North American operations. Most recently he was senior vice president and chief financial officer for Chiquita’s operations worldwide.

Loyd said Chiquita invested heavily in the Fresh Express operation in the past year, citing the opening of a new packing facility in the Chicago suburb of Streamwood, Ill. That plant was fully operational by the end of 2013 and combined the operations of three others, which have been closed, Loyd said.

 

May 5
Chiquita reveals plans for merged firm
By Coral Beach, Staff Writer

Talks about merging Chiquita Brands International and Fyffes Plc began as early as 2011 when the company was considering moving its headquarters out of Cincinnati, according to documents filed with the Securities and Exchange Commission.

That timeline revelation spurred officials in Charlotte, N.C., to tell local media they will review tax breaks they OK’d for Chiquita when it agreed to move its home base to their city in late 2011.

The SEC filings state the new merged company, to be called ChiquitaFyffes Plc, will be incorporated in Ireland.

Since announcing the merger in February, Chiquita officials have repeatedly said several hundred employees will remain in Charlotte after the merger, which they say meets their obligations to the city and North Carolina. The SEC filing states the new company’s “general meetings” will not have to be conducted in Ireland.

Ireland is a beneficial location, according to the SEC filing, for several reasons, including both companies’ existing international markets and “fewer negative tax effects.”

Top managers and the structure of the new company are detailed in the SEC filing, including a 13-member board of directors with Chiquita and Fyffes each appointing six members. The 13th board member will be jointly appointed.

As of the April 29 SEC filing, Chiquita had not determined who it will appoint to the board, except that current chief executive officer Ed Lonergan will be chairman of the ChiquitaFyffes board.

 

May 19
Chiquita relocating operations to New Orleans
By Doug Ohlemeier, Eastern Editor

After a 40-year absence, Chiquita Brands International Inc., is returning to the Port of New Orleans.

The Charlotte, N.C.-based Chiquita plans to relocate operations from Gulfport, Miss., to The Crescent City early next year.

During the mid-1970s, Chiquita, which then did business as United Brands, transferred shipping operations from New Orleans to the Port of Gulfport after importing bananas and other fruit for more than 70 years in New Orleans.

Chiquita is forecast to ship 60,000 to 78,000 20-foot-equivalent units a year at the New Orleans port.

The volume represents a 15% increase in the port’s current container volume, according to a news release.

 

June 9
Chiquita, Fyffes merger clears anti-trust hurdle
By Coral Beach, Staff Writer

Chiquita Brands International Inc.’s proposed $1 billion merger with Dublin-based Fyffes PLC is moving forward.

Part of the process of combining two of the world’s four biggest banana companies reached completion June 2 with the expiration of a waiting period for U.S. antitrust review of the deal as called for by the Hart-Scott-Rodino Antitrust Act, according to a news release.

Other closing conditions remain before the deal is done, but company officials remain confident that the transaction will be finished by the end of the year.

Shareholders of Fyffes and Chiquita still must approve the deal, according to the release. The companies must also meet additional regulatory conditions before closing the merger deal.

If the deal goes as planned, the new company, ChiquitaFyffes, will have estimated annual revenues of $4.6 billion, according to The Irish Times newspaper.

 

June 16
Chiquita denies targeting anti-terrorism legislation
By Mike Hornick, Staff Writer

Chiquita Brands International, Charlotte, N.C., has denied a report in The Daily Beast that the company tried to block an anti-terrorism bill backed by some 9/11 victims and families.

Citing congressional lobbying disclosures, the online publication said Chiquita spent $780,000 in the past year and a half lobbying against the Justice Against Sponsors of Terrorism Act (http://tinyurl.com/mynrtue).

Versions of the bill in the U.S. House and Senate target funding sources for terrorism and aim to facilitate claims against them.

“Chiquita has never sought to prevent the passage of JASTA or to deny a remedy to victims of the 9/11 attack,” director of communications Ed Loyd said in a June 4 statement.

“To the contrary, Chiquita supports the cause of terrorist victims, as Chiquita was one itself,” according to the statement.

“And the article falsely portrays Chiquita as having spent hundreds of thousands of dollars on this purported lobbying campaign, when the facts show that is not true.”

The company acknowledged contacting congressional staff on the proposed law.

“Chiquita’s concern is that the legislation, as currently drafted, could potentially encourage meritless lawsuits against innocent individuals and companies forced to pay ransom to secure the release of loved ones who are kidnapped by terrorists,” Loyd said in the statement.

 

Aug. 18
Chiquita says no deal to pair of sales offers
By Andy Nelson, Markets Editor

Chiquita Brands International has rejected an overture by two Brazilian companies to buy the company.

Charlotte, N.C.-based Chiquita’s board of directors said the bid, by juice maker Cutrale and investment firm Safra Group, was “inadequate and not in the best interests of Chiquita shareholders,” according to a Aug. 14 letter from Chiquita executives to the two companies.

The Brazilian companies made an unsolicited bid, announced Aug. 11, to buy Chiquita’s outstanding common sock for $13 per share.

The offer came as Chiquita and Dublin-based Fyffes PLC wait for their shareholders to approve a proposed merger of the two companies and for final regulatory approval of the deal.

The proposed $1 billion Chiquita/Fyffes merger took a step forward June 2 with the expiration of a waiting period for U.S. antitrust review of the deal.

In its letter to Cutrale and Safra Group, Chiquita said its board “continues to strongly believe in the strategic merits and value provided by the proposed transaction with Fyffes.”

The Brazilians’ bid was 29% higher than Chiquita’s closing stock price on Aug. 8, according to media reports.

Shares of Chiquita rose more than 30% Aug. 11 in response to the Brazilians’ offer. Shares of Fyffes fell 13%.

 

Aug. 25
Brazilians still pushing to purchase Chiquita
By Andy Nelson, Markets Editor

Two Brazilian companies rejected by Chiquita Brands International have not given up in their bid to buy the company.

Juice maker Cutrale Group and investment firm Safra Group filed a proxy statement with the Securities and Exchange Commission on Aug. 14 asking shareholders of Charlotte, N.C.-based Chiquita to reject Chiquita’s proposed merger with Dublin-based Fyffes PLC.

The proxy statement comes in advance of a Sept. 17 Chiquita shareholders meeting in Charlotte.

The Brazilian companies made the SEC filing shortly after Chiquita rebuffed their offer, announced Aug. 11, to buy Chiquita’s outstanding common stock for $13 per share.

As of Aug. 21, the filing had not changed Chiquita’s resolve to go forward with its merger plans, said spokesman Ed Loyd.

“Chiquita remains committed to completing its transaction with Fyffes, which we believe will create a combined company that is better positioned to success in a highly competitive marketplace, while driving strong performance and value for shareholders,” Loyd said.

Cutrale and Safra Group’s offer, Loyd said, is “inadequate and not in the best interest of Chiquita shareholders.”

The Brazilians’ offer came as Chiquita and Fyffes wait for their shareholders to approve their merger and for final regulatory approval of the deal. The proposed $1 billion merger took a step forward June 2 with the expiration of a waiting period for U.S. antitrust review of the deal.

In their SEC filing, Cutrale and Safra Group said it makes more financial sense for shareholders to reject the merger with Fyffes and consider a buyout instead. The filing does not, however, ask shareholders to approve a buyout. Instead it asks shareholders to vote for an adjournment proposal.

 

Sept. 15
Chiquita Brands open to sale to Brazilians, signs confidentiality agreement
By Andy Nelson, Markets Editor

Reversing an earlier decision, Chiquita Brands International will discuss a possible sale of the company to two Brazilian firms, with whom it has signed a confidentiality agreement.

Charlotte, N.C.-based Chiquita announced Sept. 8 that Dublin-based Fyffes PLC, with whom Chiquita is set to merge, has given Chiquita permission to engage in discussions with juice maker Cutrale Group and investment firm Safra Group, according to a Chiquita news release.

On Sept. 10, the company announced it had signed a confidentiality agreement with the companies.

“Chiquita has sent a letter to Cutrale/Safra indicating its willingness to offer to Cutrale/Safra the opportunity to conduct focused due diligence and present its final and best offer,” according to the release.

In addition, a Chiquita shareholders meeting set for Sept. 17 has been pushed back to Oct. 3.

Chiquita does, however, continue to recommend, at least as of Sept. 10, that its shareholders vote for the Fyffes merger.

Under the confidentiality agreement, Cutrale and Safra will have access to a Chiquita data room and to the company’s management team.

Initially, Chiquita rejected the Brazilians’ Aug. 11 offer to buy Chiquita’s outstanding common stock for $13 per share.

Cutrale and Safra did not give up, however. The companies filed a proxy statement with the Securities and Exchange Commission on Aug. 14 asking shareholders of Chiquita to reject Chiquita’s proposed merger with Fyffes, which is valued at $1 billion.

 

Oct. 6
Fyffes sweetens pot for Chiquita in merger deal
By Andy Nelson, Markets Editor

Under a revised agreement, Chiquita Brands International shareholders would own a greater share of the new company created by the merger of Charlotte, N.C.-based Chiquita and Dublin-based Fyffes PLC. Chiquita shareholders would own 59.6% of the merged company, up from 50.7% under the initial agreement, according to a Sept. 26 Chiquita news release.

The new agreement comes as Chiquita is discussing a possible sale of the company to two Brazilian firms, with whom it has signed a confidentiality agreement.

 

Oct. 13
European Commission OKs Chiquita-Fyffes merger
By Coral Beach, Staff Writer

A green light from the European Commission on the proposed $1 billion merger of Charlotte, N.C.-based Chiquita Brands International Inc. and Fyffes Plc. moves the two firms a step closer to becoming the top banana company on the planet, but some investors have asked a federal court to intervene.

A shareholder vote is set for Oct. 24, according to a timetable approved by the European Commission. Boards of Chiquita and Fyffes have already approved the merger.

The High Court of Ireland also must approve the deal.

 

Oct. 27
Brazilians boost bid for Chiquita on eve of vote
By Coral Beach, Staff Writer

The day before a vote on its $1 billion merger deal with Fyffes PLC, officials with Chiquita Brands International Inc. notified shareholders that two Brazilian companies had upped their unsolicited bid for a second time, offering $14.50 per share.

A week earlier the Chiquita board unanimously rejected a bid of $14 per share from the Cutrale Group and the Safra Group. The Brazilian orange juice company and investment bank initially offered $13 per share Aug. 11 and increased that to $14 in early October.

The stockholder vote set for Oct. 24 was expected to take place as scheduled, said Chiquita corporate communications director Ed Loyd on Oct. 23.

The Charlotte, N.C.-based banana giant urged shareholders “to review the proxy and other materials previously circulated,” according to an Oct. 23 news release. Fyffes stockholders were scheduled to vote on the deal Oct. 28. The latest Cutrale/Safra bid expires Oct. 26.

“Chiquita’s board of directors, in consultation with its financial and legal advisers, will carefully review and consider the revised Cutrale/Safra offer in light of the best interests of the company and its shareholders,” according to the Chiquita release.

In response to the Brazilians’ initial bid, Dublin-based Fyffes sweetened its offer to Chiquita.

Fyffes is now offering $13 per share and Chiquita shareholders of the new ChiquitaFyffes company would own 59.6% of the new entity, compared to the 50.7% previously offered.

If the Chiquita-Fyffes deal is OK’d, the new company would be the top banana firm in the world. Currently, the world’s $7 billion banana market is controlled by the two companies plus Dole Food Co. and Del Monte Fresh Produce.

 

Nov. 3
Chiquita goes Brazilian after Irish merger vetoed
By Coral Beach, Staff Writer

After their shareholders rejected a merger with Fyffes Plc. by a margin of more than two to one, the Chiquita board of directors unanimously approved a buyout offer of $1.3 billion from two Brazilian companies.

The Oct. 24 vote showed almost 26 million shares voting against the Fyffes merger and less than 12.5 million shares in favor of the deal.

Holders of more than 107,000 shares abstained from the vote, according to documents filed with the Securities and Exchange Commission.

Three days after the vote, Ed Lonergan, CEO of Chiquita Brands International Inc., Charlotte, N.C., issued a joint statement with officials of Brazil’s Cutrale Group and Safra Group saying the Chiquita board unanimously approved a buyout of $14.50 per share.

Cavendish Acquisitions Corp., established by the Brazilian companies to handle the buyout, is acquiring Chiquita’s debt, bringing the cash value of the deal to $1.3 billion. Officials said in the Oct. 27 news release they expect the transaction to close by the end of the year or in early 2015.

Officials at Chiquita did not respond to questions regarding the future of top managers at the company. A spokeswoman for the Brazilian companies said Oct. 27 that such details remain to be resolved.

Chiquita will be a wholly-owned subsidiary of the Brazilian companies. It will remain incorporated in New Jersey, according to the joint news release.

Chiquita and Dublin-based Fyffes had been working on their merger since at least March. An unsolicited bid in August from Brazil’s juice giant Cutrale Group and investment bank Safra Group began a downhill slide for the deal.

The merger with Fyffes would have made the new company the top banana firm in the world’s $7 billion banana market.

“While we are convinced they would have been a strong merger partner, we will now go forward as competitors,” Lonergan said in a news release.

When the Brazilians entered the picture with a $13 per share offer in August, Fyffes upped its offer.

Ultimately Fyffes offered $13 per share and a larger interest (59.6%) in the proposed ChiquitaFyffes company, which would have become the world’s top banana firm.