Fyffes Share Discussion Threads

[leebong] 27/10/2014 13:49

Fyffes, the Dublin-headquartered banana distributor, looks set to pick up a “break fee” of at least $23.5 million (€18.5 million) after shareholders of its US rival Chiquita Brands rebelled against its board and voted down a proposed $1 billion merger with the Irish company.

[leebong] 26/10/2014 13:50

Fyffes was needed by Chiquita to remain solvent and that reasoning was amplified last May when Chiquita returned a $3 million loss in their Q1/14 results due to very cold weather affecting the Fresh Express salad business. Chiquita over extended itself after financing the salad business with $600million USD which has since been written off a few months ago in their accounts.

Fyffes is a high growth $1 Billion USD business which returns profits every quarter. Making it a very interesting M&A partner.

[leebong] 25/10/2014 21:12

Few individuals have lost out more on the scuppering of the ChiquitaFyffes merger than David McCann, executive chairman of Fyffes, which was yesterday dumped at the altar by the shareholders of its would-be US bride.

McCann, who would have headed up the new operation, was due payments of up to $13.5 million (€10.5m) in salary and bonuses over the first two years post the merger were it to succeed.

He was paid about €1 million by Fyffes last year in salary and bonuses, before share awards and pension payments.

Quite a difference. Not that the wolves will be scratching at the door of the millionaire scion of one of Ireland’s most blue-blooded corporate families.

Ireland has lost out too, however. ChiquitaFyffes, which would have been the biggest banana company in the world, was to have been headquartered and essentially run from here, although listed in New York.

Having another global industrial leader operating out of Dublin would have done corporate Ireland no harm at all in the prestige stakes. Ryanair, Smurfit Kappa and CRH, all leaders in their respective fields, are proof of that.

The deal essentially failed because Chiquita’s shareholders did not trust their own board, whose reputation came under relentless attack from the Brazilian suitors who wrecked the merger. The shareholders simply did not believe it when they were told the merger would deliver savings of up to $60 million. Chiquita’s board has in recent years regularly failed to live up to its own guidance.

What now for Fyffes? It will go back to what it was before the merger was proposed – the biggest banana importer in Europe, a steady operator with a conservative balance sheet and a penchant for smaller deals.

It was always punching above its weight with the Chiquita merger. Much smaller than the US company, it had initially secured a much larger slice of the enlarged entity than it should really have been entitled to – almost 50 per cent – by dint of its healthy balance sheet. Even when it agreed to scale back its stake to closer to 40 per cent, it still looked a remarkably good deal for it.
Debt-addled Chiquita needed Fyffes more than Fyffes needed it. The Irish company got dumped. But the bride wasn't all that much to shout about anyway.



Fyffes have sent a message to the markets that it want to do M&A deals to expand on the world stage of food production. There will be more suitors coming forward with perhaps more convincing credentials for this growth and profit engine to consider.

There will be more offers tabled sooner or later.

[castleford tiger] 25/10/2014 14:30

Well I see value here as well.
for once I called this right and sold many months ago.

so current year I estimate eps 10.60 euro about 8.6p a share.So about 8.13 times current.

That's not expensive.
There maybe a few quid also to come in following the settlement.

The shares look worth buying on any weakness. I will be back in.

Tiger

[battlebus2] 25/10/2014 09:31

In the words of Alan Sugar and it is with regret but Investali your filtered.

[battlebus2] 24/10/2014 21:18

Ali I don't want you to follow me anywhere thus my reasoning to stop posting. You seem incapable of getting the message and for your info i still see potential in FFY.

[investali] 24/10/2014 19:55

BB2 I see you are still posting!

Not a good day for you here I nearly followed you into Fyffes but for once I was bananas and didn't!!

Hope to see you do well in the end but I'm afraid it'll be some time before you see 80p again.

Ali.

[battlebus2] 24/10/2014 17:39

Yes a sad end to what would have been a great combination and would also have certainly improved on the $14.50 offered but the grab your money now and not think about the long term brigade have won the day.
As i said yesterday i did think the vote may not have proceeded, no figures as yet on how the final tally went, it will be interesting to see how close it was.
The management at both co's have to be applauded on how they conducted themselves both before and after the vote and it's clear to see the Chiquita board are as disappointed as the Fyffes shareholders.
All is not lost and we have a lot to look forward too, we are currently trading on a p/e of 10 and recent guidance has been raised for 2015 with increasing profits, increasing dividend and if they decided the board could approve a 4p special dividend. Though we will have costs relating to this failed merger.
Then again i have no doubt that consolidation will continue in the sector and we are still a target and who knows what may occur it's not impossible cultrale/safra may return at some point but i suspect others may beat them to it.

[leebong] 24/10/2014 15:12

The compensation due based on the closing price of Chiquita yesterday is :

$23,100,000USD approximately.

Shareholders may get a special dividend.

[leebong] 24/10/2014 15:09

Fyffes PLC

24 October 2014

Fyffes plc

Stock Exchange Announcement

Fyffes announces Termination of Transaction Agreement with Chiquita

DUBLIN, Ireland - 24 October 2014 -Fyffes plc (ESM: FFY ID: AIM: FFY LN) ("Fyffes") today announced that it exercised its right to terminate the revised transaction agreement with Chiquita Brands International, Inc. (NYSE: CQB) ("Chiquita") announced on 26 September 2014. Pursuant to the revised agreement, should Chiquita enter into a separate transaction agreement within nine months, Fyffes is entitled to a termination fee of 3.5% of the total closing value of the issued share capital of Chiquita the day prior to such agreement.

David McCann, Fyffes Executive Chairman, commented:

"Fyffes remains the leading European banana company with turnover in excess of EUR1 billion and a long and successful history of growth. Fyffes management team has a proven superior track record of delivering shareholder value, as demonstrated by our consistently strong results in recent years and solid balance sheet. We are confident Fyffes will remain at the forefront of the global produce industry. We will continue to focus on successfully developing our business for the benefit of all stakeholders. We extend our gratitude to Ed Lonergan and the Chiquita team for their professionalism during the process and wish them well in the future. We would like to thank all our team and advisors who have worked tirelessly and diligently on this transaction."

[leebong] 24/10/2014 15:06

Closure at last the bid has been rejected but Fyffes should collect 16 million Euros compensation.

Chiquita Announces Results of Special Meeting of Shareholders
Chiquita and Fyffes Terminate Transaction Agreement

Chiquita Expects to Enter Into Discussions with Cutrale/Safra Group Regarding Their $14.50 Per Share Offer

CHARLOTTE, N.C., Oct. 24, 2014 (GLOBE NEWSWIRE) -- Chiquita Brands International, Inc. (NYSE:CQB) ("Chiquita") today announced that based on the votes cast at the Company's Special Meeting of Shareholders held today Chiquita shareholders have not approved the revised transaction agreement with Fyffes plc (ESM: FFY ID: AIM: FFY LN) ("Fyffes"). Accordingly, each of the parties has delivered notice to terminate the transaction agreement, and the proposed combination with Fyffes has lapsed for the purpose of the Irish Takeover Rules.

In addition, Chiquita said that it expects to enter into discussions with the Cutrale/Safra Group regarding Cutrale / Safra's revised offer to acquire all of the outstanding stock of Chiquita for $14.50 per in cash.

"We appreciate the consideration and perspectives of all Chiquita shareholders who participated in this process," said Edward F. Lonergan, President and Chief Executive Officer of Chiquita. "Given today's results, we have determined to terminate the agreement with Fyffes and to engage with Cutrale / Safra regarding its revised offer. I want to thank David McCann and the entire Fyffes team for their efforts throughout this process. While we are convinced they would have been a strong merger partner, we will now go forward as competitors. We would also like to express our gratitude to Chiquita's employees for their hard work and dedication on behalf of Chiquita and our customers."

[leebong] 24/10/2014 12:20

Chiquita Special Meeting of Shareholders to Proceed at 9:00 AM ET to Consider ChiquitaFyffes Merger
Globe Newswire
Chiquita Board Considered the Revised $14.50 Offer From Cutrale/Safra and Determined to Reaffirm Its Recommendation of the ChiquitaFyffes Merger
October 24, 2014: 07:00 AM ET


CHARLOTTE, N.C., Oct. 24, 2014 (GLOBE NEWSWIRE) -- Chiquita Brands International, Inc. (NYSE:CQB) ("Chiquita") today issued the following statement with respect to today's Special Meeting of Shareholders:
Kerrii B. Anderson, Chairwoman of the Chiquita Board of Directors and Ed Lonergan,

Chiquita`s Chief Executive Officer said, "Chiquita's Board continues to believe in the long-term value of the ChiquitaFyffes merger and does not believe that the $14.50 offer from Cutrale/Safra is superior to the potential combination. The Board intends to convene the Special Meeting as scheduled at 9:00 AM ET in Charlotte to allow shareholders to vote on the ChiquitaFyffes merger.

The Board also determined that if shareholders do not approve the combination with Fyffes, the Board intends to continue discussions with Cutrale/Safra."

The Special Meeting of Shareholders to vote on the proposed combination with Fyffes plc (ESM: FFY ID: AIM: FFY LN) ("Fyffes") (the "Combination") will proceed as scheduled today at 9:00 AM ET in Charlotte.

[leebong] 23/10/2014 18:34

The Cutrale-Safra bid would lead to an inversion to Brazil and the lose of thousands of Chiquita jobs. However Fyffes may benefit by continued penetration of the U.S. market if the merger failed. Either way Fyffes will become a stronger enterprise because Cutrale is using Chiquita as a life-boat due to a permanently falling orange juice market.

Fyffes have established growth worldwide having recently expanded into Asia. It is this engine of expansion in new markets and expansion of it's fruit farms that Chiquita will need to survive long term.

The Chiquita Fresh Express salad business has been realised as a high initial investment project that cost $600 million USD that yields low margins against very high volume which is weather dependent and sensitive to winter temperatures. Chiquita failed to focus on the core business and became indebted, the overspend has since been written off in the accounts. That signals poor management skills and risk; Chiquita would benefit from the astute approach that Fyffes have in conducting their activities.

Therefore if the merger bid fails there will be plenty of other opportunities with lower risk partners. If the bid succeeds then Fyffes will refocus the Chiquita business and make it profitable. This aspect has been under-estimated by Cutrale-Safra and they may suffer the consequences of an unforgiving competitor in Fyffes.

[battlebus2] 23/10/2014 18:09

Wynnefield: Increase in Cutrale-Safra Offer is “Significant”
Print
Alert
Chiquita (NYSE:CQB)
Intraday Stock Chart
Today : Thursday 23 October 2014


Calls on ISS to Swiftly Review Updated Proposal; Insists Meeting Be Conducted Tomorrow, As Scheduled

Wynnefield Capital, a long-term holder of Chiquita Brands (NYSE:CQB), owning 1,646,103 shares or 3.5% of the company, today announced that it views today’s updated offer by Cutrale-Safra to $14.50 per share in cash as a “significant” increase in the offer price and affirmed its support for the Cutrale-Safra transaction.

WYNNEFIELD EMPHASIZED THAT THE SPECIAL MEETING OF SHAREHOLDERS OF CHIQUITA SHOULD BE CONDUCTED AS SCHEDULED ON OCTOBER 24, 2014.

Also, in light of the offer increase, Wynnefield called on proxy advisory firm ISS to swiftly re-consider its prior recommendation. Wynnefield reiterated its previously stated belief that ISS’ prior recommendation was flawed, relying on dubious long-term projections devised by the partisan Fyffes/Chiquita investment bankers that failed to account for the commoditized and unpredictable nature of operational risks in Chiquita’s business, as well as flawed projections of synergies that failed to properly account for EU regulatory developments.

That view was validated by a resounding market reaction. On the day ISS issued its recommended support for the Fyffes scheme, Chiquita Brands’ share price fell by about 4.2%, even as broader markets were flat to slightly up.

Wynnefield reiterated that its analysis demonstrates that the all-cash Cutrale-Safra proposal would provide superior value and eliminate the risks associated with a merger contemplated in the Fyffes proposal. Wynnefield projects that Chiquita’s shares would fall by $2.00 – $2.50 if the Fyffes scheme were approved.

In fact, the revised Cutrale-Safra offer could have been $14.70 per share had the Chiquita Board of Directors not increased the break-up fee from 1% to 3.5% as part of its revised Fyffes scheme, thus limiting the potential upside to shareholders, while further entrenching themselves.

The Wynnefield analysis concludes that, as a company analyzed on a cash-flow basis, rather than an Earnings per Share (EPS) basis, Chiquita Brands would be a better company for all stakeholders as a private enterprise, and that today’s increased offer reflects Cutrale-Safra’s commitment to appropriately taking the company private.

[leebong] 22/10/2014 16:26

The vote on Friday afternoon will be a close call. But the only shareholders who can vote will be those who have held the stock for some time. It is quite likely that many investors sold out at the $14 USD/ Share level reducing the numbers of voters while the BOD and CEO increased their holding. There are two known investment houses who will vote against the merger. They own a combined holding of about 6%. But institutional investors have reduced by 4% in the last few weeks effectively cancelling out there influence and I suspect the Fireman and Police Pension Fund have sold their stock at $14 USD in the last week or so.

A huge boost to the merger has been the ISS supporting the merger by citing that the Cutrale-Safra proposal does not provide any compensation to existing investors. The Chiquita CEO is looking for at least $15:60 USD/share as a minimum and that will not materialise. If the merger fails Cutrale - Safra will probably reduce their bid back to $13 USD/ Share as their offer was not irrevocable and it times out as an offer on October 26.

This will be a transformational week for Chiquita either way and perhaps Fyffes.

It is definity TIME TO BUY AND TIME TO VOTE YES FOR THE FYFFES MERGER.

Fyffes is a long established business that returns profits every quarter without fail. This is going to be a great combination that will enhance markets, logistics and most importantly farming and business expertise managing a combined 26,000 Hectares of farm property producing tropical fruit.

I am looking forward to $23:50 USD/ Share as a target by Q1/16.

[primachm00] 22/10/2014 15:37

I wonder how smart is Mr Market? Chiquita today trading down at about $13.18.
Since Safra bid is at $14, and vote on merger just 2 days away, this implies
that merger wont go thru. Otherwise Chiquita should be trading close to $14?
What think you?

[leebong] 22/10/2014 08:15

Chiquita reiterates value of Fyffes deal

22 October 2014 | 08:07am
StockMarketWire.com - Chiquita Brands International reiterated the value of its combination with Fyffes.

And Chiquita also says it wants to set the record straight regarding 'inaccurate and misleading statements made by the Cutrale Group and the Safra Group' in an attempt to support an inadequate $14.00 per share offer to acquire Chiquita.

President and chief executive Edward F. Lonergan sai:, "Chiquita's Board of directors is solely focused on maximizing value for all Chiquita shareholders. In contrast, Cutrale/Safra appears only interested in acquiring Chiquita for the lowest possible price without adequately compensating Chiquita shareholders."

Chiquita says significant progress made by the group since implementing its 'return to the core' strategy' has been ignored by Cutrale/Safra.

And Chiquita says that a combination with Fyffes will further the 'return to core' strategy and create significant additional value for shareholders.

- See more at:

[leebong] 20/10/2014 21:56

Fyffes deal with Chiquita now looks more likely to succeed
Advisory group reverses call for shareholders to vote against merger

Chiquita shareholders will vote on the merger on Friday while Fyffes shareholders will vote next Monday. Photograph: Simon Dawson/Bloomberg

Mon, Oct 20, 2014, 19:46
First published:
Mon, Oct 20, 2014, 19:46

Efforts by Fyffes to conclude a proposed $1 billion merger with Chiquita Brands to create the world’s biggest banana company received a boost yesterday when Chiquita said an influential proxy advisory group had reversed its recommendation that shareholders vote against the deal.

Institutional Shareholder Services (ISS) had advised Chiquita shareholders to reject the merger in favour of a cash offer from Brazil’s Cutrale-Safra, but now says it is the best deal.

Chiquita told the stock market that ISS said its board had acted “appropriately” by sticking with the proposed merger, despite rival cash bids from Cutrale-Safra. Merrion analyst David Holohan said the move “is indicative of the strategic rationale of the merger winning out over the shorter-term opportunism that was present in the Cutrale-Safra offer”.

“ISS has concluded that the Cutrale-Safra offer... does not provide sufficient compensation to Chiquita shareholders to warrant giving up on the potential upside of the revised Fyffes transaction,” ISS said.

Chiquita shareholders will vote on the merger on Friday while Fyffes shareholders will vote next Monday.

[leebong] 20/10/2014 16:37

With this backing the merger will probably go ahead...so standby for Fyffes share price to surge.


Leading Proxy Advisory Firm ISS Changes Recommendation to Chiquita Shareholders to Vote "FOR" Proposed Combination With Fyffes
By GlobeNewswire, October 20, 2014, 10:48:00 AM EDT
Vote up AAA


Combination With Fyffes Garners Industry Research Analyst Support

CHARLOTTE, N.C., Oct. 20, 2014 (GLOBE NEWSWIRE) -- Chiquita Brands International, Inc. (NYSE:CQB) ("Chiquita") today announced that Institutional Shareholder Services ("ISS"), a leading independent proxy voting and corporate governance advisory firm, has changed its previous recommendation and is advising its clients to vote "FOR" Chiquita's revised merger agreement with Fyffes plc (ESM: FFY ID: AIM: FFY LN) ("Fyffes") (the "Combination"). ISS is now recommending that Chiquita shareholders vote "FOR" the pending combination with Fyffes.

In its revised recommendation issued on October 20, 2014, ISS stated:

"After reviewing the value and relative certainty of the two competing transactions, as well as the appropriateness of the target board's response to the unsolicited bid, ISS has concluded that the $14.00 Cutrale/Safra offer, while higher than Chiquita closing prices immediately prior to the Cutrale/Safra's first bid, does not provide sufficient compensation to Chiquita shareholders to warrant giving up on the potential upside of the revised Fyffes transaction."*

"While the Cutrale/Safra cash bid appears to offer relative certainty of value, it does not appear to offer a sufficient premium to the value of the ChiquitaFyffes combination, as indicated by present value of 2016 EBITDA and free cash flow multiples. As the target board's response to the unsolicited bid appears to have been appropriate-leading, ultimately, to improvements in both offers prior to the definitive shareholder vote-there does not appear to be any credible evidence the Chiquita board has not been acting in shareholders' best interest."*

"Accordingly, Chiquita shareholders should vote FOR the Fyffes transaction and AGAINST Cutrale/Safra's proposal to give Cutrale/Safra unilateral ability to further adjourn the Chiquita shareholder meeting."*

In response to ISS' positive recommendation, Edward F. Lonergan, President and Chief Executive Officer of Chiquita commented:

"We are pleased that ISS recognizes the increased value provided to Chiquita shareholders under our revised transaction with Fyffes, including an improved exchange ratio and increased synergies estimates. The Chiquita Board continues to strongly believe in the strategic merits and value provided by the revised ChiquitaFyffes transaction, which it believes will create a combined company that is better positioned to succeed in a highly competitive marketplace, while driving strong performance and value for shareholders. We look forward to completing the transaction expeditiously and urge shareholders to follow ISS' recommendation by voting "FOR" the proposed combination with Fyffes."

Combination with Fyffes Garners Industry Research Analyst Support

In addition to ISS' support, a leading industry research analyst has recently provided favorable commentary on Chiquita's proposed combination with Fyffes and the value the combination will deliver to Chiquita shareholders:

"In the current environment, we understand some investors questioning the decision to forego a certain $14 value, but one must remember that this market will indeed turn better, and we believe that true shareholders would prefer a tie-up with Fyffes - along with the inherent value creation potential that it brings - instead of a stubbornly low bid from a Brazilian orange concentrate producer, whose real goal in our view is to steal an asset away in order to diversify its portfolio. Consider the lengths that Fyffes has been willing to go in order to merge with Chiquita vs. the actions of Cutrale/Safra, to date; it seems clear to us who sees value creation potential for the long haul vs. who is looking for a quick (economical) fix. We applaud CQB management and its Board for aiming to protect shareholder interests, even if some don't fully yet realize such."*

- Brett M. Hundley, BB&T Capital Markets (October 17, 2014)



Read more:

[leebong] 20/10/2014 16:07

ISS backs Chiquita Brands-Fyffes merger plan

Oct 20 2014, 10:36 ET | About: Chiquita Brands Internati... (CQB) | By: Clark Schultz, SA News Editor Contact this editor with comments or a news tip

Proxy firm ISS advises Chiquita Brands (CQB -0.6%) shareholders to vote for the proposed merger with Fyffes.The value of a Chiquita-Fyffes combination outweighs the higher deal price of the Cutrale/Safra bid, according to ISS.