Fyffes deal at risk as Chiquita receives competing offer

Chiquita, the company which agreed to merge with Irish food group Fyffes earlier this year to create the world's largest banana producer, has received a competing takeover offer from Florida-based juice maker Cutrale Group and Brazilian investment firm Safra Group. The deal is conditional on North Carolina based Chiquita terminating its deal with Fyffes.

A spokesman for Fyffes said this evening the company would not be making a statement.

Cutrale and Safra offered $13 per share in cash, a 29 per cent premium to Chiquita's closing price on Friday, August 8th, valuing the company at $610.5 million. The proposal was conveyed to Chiquita in a letter to Kerrii Anderson, chairwoman of the Chiquita board of directors and Edward Lonergan, Chiquita president and chief executive officer.

In this letter, Michael Rubinoff said that Cutrale and Safra could complete the deal " within the same timeframe you have indicated for the Fyffes transaction, without the execution risk and uncertainty inherent in that transaction" adding that the deal is subject to "the termination of the Fyffes transaction agreement".

Fyffes fell by 7.5 per cent in Dublin trading following the announcement.

In June, the proposed $1 billion merger of Fyffes and Chiquita cleared a major regulatory hurdle in the US when the waiting period for US antitrust review of the deal expired, essentially satisfying one condition to the closing of the transaction.The deal remains subject to other regulatory clearances and approval by shareholders of both companies. The new merged entity, ChiquitaFyffes, was to be listed on the New York Stock Exchange but domiciled in Ireland, and would have combined annual revenues of $4.6 billion (€ 3.3 billion).