Fyffes plans a year-end float of worldoffruit.com

Fyffes plans to float its worldoffruit.com Internet subsidiary, probably on the Nasdaq market in New York, by the end of the year.

Fyffes director Mr Philip Halpenny told a Merrion Capital Internet conference yesterday that it would take $100 million (€103 million) to develop the online fruit exchange and the likelihood was that these funds will be raised through a flotation.

Mr Halpenny said that he expected annual sales of $300 million through the exchange by the end of this year.

Fyffes had considered various funding options for worldoffruit.com. Originally, it thought to raise around $20 million of development finance from venture capitalists as a prelude to a flotation.

Now it seems Fyffes plans to go directly to an initial public offering (IPO) by the end of the year and will fund development from its own ample cash resources until the subsidiary is floated on Nasdaq.

Market sources have speculated that Fyffes would probably sell about 25 per cent of the company on the market, with further share issues as development finance was needed.

The establishment of worldoffruit.com has been the main reason for the doubling of the Fyffes share price in the past three months and the fact that the group plans an early IPO will probably maintain strong interest in the stock.

One major element of worldoffruit.com is its fruitXchange Internet trading operation for the world fresh produce industry. Currently, the world fresh produce industry is worth $250 billion annually and Fyffes expects that 10 per cent of this will be traded over the Internet within the next five years.