US: Chiquita plans for banana behemoth collapse

Plans for Chiquita to establish the world’s largest banana producer through a merger with Ireland’s Fyffes are headed for collapse as Chiquita shareholders voted against the transaction Friday.

According to reports, the US banana firm is now in limbo as it has only days to decide whether to accept an unsolicited bid by two Brazilian companies to acquire the company, now that a deal with Fyffes appears thwarted. Reports say Chiquita rejected the offer from Brazilian companies Cutrale and Safra three times.

In a statement, Chiquita CEO Ed Lonergan confirmed that the company has decided “to terminate the agreement with Fyffes and to engage with Cultrale/Safra regarding its revised offer.” Experts say a takeover by the Brazilian companies could threaten a shakeup of Chiquita’s US headquarters and its employees.

Chiquita and Fyffes had already received clearance from US authorities for their merger, but the deal earned criticism for Chiquita’s plans to relocate its tax bracket to Ireland, where Fyffes is based, and receive a lesser tax burden. Such deals, known as inversion mergers, are being more closely scrutinized by regulators in the US and EU.

Full content: News Observer

Want more news? Subscribe to CPI’s free daily newsletter for more headlines and updates on antitrust developments around the world.