Fyffes and Chiquita in talks with EU over merger plan

Chiquita and Fyffes have submitted remedies to the European Union to deal with the likely impact that their proposed merger will have on competition.

The European Commission’s competition section said that the remedies were submitted on September 12 but did not outline what specifically the companies had offered.

The commission has also extended its deadline for reviewing the huge proposed merger until October 3.

In a joint statement yesterday, Fyffes and Chiquita confirmed that they are in discussions with the commission regarding possible limited commitments with a view to obtaining clearance of their previously-announced merger transaction.

The proposed commitments, if adopted, are not expected to have any material impact upon the commercial rationale for the transaction, the statement said.

While there can be no assurances, Fyffes and Chiquita said they remain of the view that there is a good prospect that their proposed transaction can be cleared by the European Commission during its Phase I review.

Earlier this month, Chiquita postponed a planned shareholder meeting to vote on the proposed merger to engage in discussions with the Cutrale and Safra groups which are also interested in acquiring the company.

The Brazilian firms made an unsolicited approach for Chiquita in August, offering $13 per share in all-cash bid. Chiquita’s board rejected the offer as “inadequate” and not in the best interests of shareholders.

If it goes ahead, the stock-for-stock merger between Chiquita and Fyffes would create a global banana and fresh produce company valued at €770m, and with sales of around €3.5bn annually, giving it a 14% share of the global banana market.

The new company would have an operating presence in more than 70 countries and would employ 32,000 people worldwide.

Fyffes is headquartered in Dublin and has operations in Europe, the US, Central and South America, and has begun operations in Asia.