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Cutrale-Safra Offer for Chiquita Raised to $14.50 a Share

Cutrale-Safra Offer for Chiquita Raised to $14.50 a Share

Posted by Juan Gavasa on October 23, 2014

Brazil’s Cutrale Group and Safra Group again increased their unsolicited joint bid to buy banana producer Chiquita Brands International Inc. (CQB) in an offer worth about $686 million.

Cutrale-Safra sweetened its offer to $14.50 a share, the joint bidders said today in an e-mailed statement, up from an earlier proposal of $14. The offer expires Oct. 26. Chiquita said in a statement it will consider it. Shareholders of Charlotte, North Carolina-based Chiquita are scheduled to vote tomorrow on the acquisition of Irish competitor Fyffes Plc. (FFY) The Chiquita-Fyffes combination would create the world’s largest banana company. It also would allow Chiquita to relocate its headquarters to Ireland, which has a lower corporate tax rate.

Cutrale, a closely held fruit juice company controlled by Brazil’s Jose Luis Cutrale, is trying to derail Chiquita’s planned purchase of Fyffes. Cutrale controls more than one-third of the $5 billion orange-juice market and has global operations in apples, peaches, lemons and soybeans.

Chiquita rose 8 percent to $13.75 at 10:04 a.m. in New York. Fyffes gained 0.3 percent to 1.018 euros in Dublin. Chiquita’s all-stock offer is currently valued at 1.20 euros a share, according to data compiled by Bloomberg. Chiquita on Oct. 16 rejected Cutrale-Safra’s $14 offer as “inadequate.” The banana producer estimates its shares will be worth $15.46 to $20.01 following its acquisition of Fyffes.

Proxy adviser Institutional Investor Services Inc. on Oct. 20 recommended Chiquita investors approve the Fyffes deal, reversing its September recommendation to pursue the buyout from Cutrale-Safra. Glass Lewis & Co., another proxy advisory firm, recommended rejecting the Fyffes takeover on Oct. 21.

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