the republic logo

Chiquita signs confidentiality agreement with potential buyers

bug
Share/Save/Bookmark

NEW YORK — Not even a month after flatly rejecting a takeover bid by two Brazilian companies, Chiquita will open its books to them.

Should Chiquita eventually see eye-to-eye with the investment firm Safra Group and Cutrale Group, a juice company, it could scuttle a proposed tie up with the Irish fruit company Fyffes, a merger that is far along in the process.

Chiquita did not elaborate Wednesday on why it had decided to talk with the Brazilian group and sign a confidentiality agreement. It said that it would "allow Cutrale / Safra to conduct due diligence, including access to a data room and its management team."

But Chiquita has been pressured to do so by two proxy advisory firms, and company shares have been depressed.

There has also been pushback on a national level against the type of deal Chiquita is trying to engineer with Fyffes.

PHOTO: FILE - In this Aug. 15, 2007 file photo, Graham and Lola East shop for Chiquita bananas at a produce stand at the Farmers Market in Los Angeles. Not even a month after flatly rejecting a takeover bid by two Brazilian companies, Chiquita is softened its stance and will open its books to them. (AP Photo/Damian Dovarganes, File)
FILE - In this Aug. 15, 2007 file photo, Graham and Lola East shop for Chiquita bananas at a produce stand at the Farmers Market in Los Angeles. Not even a month after flatly rejecting a takeover bid by two Brazilian companies, Chiquita is softened its stance and will open its books to them. (AP Photo/Damian Dovarganes, File)

The new company, called ChiquitaFyffes PLC, with a new headquarters in Ireland, would allow Chiquita to lower its U.S. tax rate.

Treasury Secretary Jacob said this week that the Obama administration would decide "in the very near future" what it could do to make it less profitable for U.S. companies to shift their legal addresses to other countries, a maneuver called an "inversion."

Political leaders like Sen. Dick Durbin of Illinois, the No. 2 Democrat in the Senate, have lashed out at inversions, saying that they increase the tax burden on everyone else.

Another major U.S. corporation, Walgreen Co., ditched an inversion plan last month under rising political heat.

Safra and Cutrale offered $611 million for Chiquita. The proposed merger with Fyffes is an all-stock deal that would move Chiquita's company headquarters from Charlotte, North Carolina, to Dublin, where Fyffes is based.

Shares of Chiquita Brands International Inc. rose 12 cents to $13.93 in midday trading.

Think your friends should see this? Share it with them!

Story copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Feedback, Corrections and Other Requests: AP welcomes feedback and comments from readers. Send an email to info@ap.org and it will be forwarded to the appropriate editor or reporter.


We also have more stories about:
(click the phrases to see a list)

Category:

Follow The Republic:

All content copyright ©2014 The Republic, a division of Home News Enterprises unless otherwise noted.
All rights reserved. Privacy policy.