Chiquita Stock Soars On $13 A Share Offer From Cutrale, Safra - Update

(RTTNews) - Banana producer Chiquita Brands International Inc (CQB) on Monday received an unsolicited acquisition bid from agribusiness company Cutrale Group and asset manager Safra Group for about $611 million in cash, placing in jeopardy Chiquita's merger deal with Irish rival Fyffes Plc (FFY.L, FYFFF).

Cutrale and Safra's $13 a share offer for Chiquita represents a premium of 29 percent to Chiquita's previous day closing price.

Upon the announcement, Chiquita shares surged 31 percent in morning trade on the New York Stock Exchange.

Chiquita, based in Charlotte, North Carolina, is a marketer of nutritious food products - from bananas, blends of convenient green salads, other fruits to healthy snacking products. Chiquita employs about 20,000 people globally and has annual revenues of more than $3 billion.

If the deal with Cutrale and Safra goes ahead, it puts an end to Chiquita's proposed merger with Fyffes. In March, Chiquita agreed to combine with Fyffes in a stock-for-stock deal that is expected to result in Chiquita shareholders owning about 50.7 percent of the combined company, and Fyffes shareholders owning rest of the stake. The deal envisages the combined company to relocate to Ireland in order to benefit from lower corporate taxes.

On Thursday, Chiquita said its second-quarter net earnings slid to $18 million or $0.37 per share from $31 million or $0.66 per share a year ago. Sales, however, rose to $826 million from $812 million.

Chiquita stock is trading at $13.20, up $3.14 or 31.21%, on a volume of 5 million shares.