Fyffes Share Discussion Threads

[ibug] 08/12/2014 14:17

Chiquita Brands International Inc. (NYSE:CQB) Offers For All Outstanding Shares Of Common Stock Of CQB- Dollar General (NYSE:DG), AK Steel Holding (NYSE:AKS)


Chiquita Brands International Inc. (NYSE:CQB) [Trend Analysis] and Safra Groups reported that the previously reported tender offer for all outstanding shares of common stock of CQB at a price of $14.50 per share, will be extended until the end of the day on Tuesday, December 23, 2014. Stocks of Chiquita Brands International Inc. (NYSE:CQB) closed at $14.46 in last session with the total traded volume of 188815. As took short look on the firm profit margin which was recorded -2.60%, and operating margin was recorded 1.20%. The Financial Institutional ownership of the firm was 90.40% while by insiders was 2.10%.

[ibug] 08/12/2014 13:03

We will get more news about the Chiquita takeover after December 23rd in the New Year before the EU decision due out around 7th January.

[isharebug] 04/12/2014 20:31

WE ARE ON THE UP-AND-UP AT LAST BATTLEBUS...Perhaps once Safra settles into the Gerkin Tower which he bought a few weeks ago his idea of empire building might take shape in the form of buying-out Fyffes....we wait and see....something is going to give for corporations to grow during the onset of a possible recession. Consolidation in this market sector may happen now because of the loss of market share for the main players over the past 8 years or so. Consolidation will grow market share but only with the blessing of the EU. They approved the Chiquita deal; there fore anything goes between the major corporates in the fresh fruit business who wish to merge/ buy Fyffes.

I suspect this market sector will consolidate reducing the number of EU players; with the aid of M&A with Fyffes.

[battlebus2] 04/12/2014 18:41

Let's hope we hear soon isharebug.
Interesting 19k buy over the odds at 78.

[isharebug] 04/12/2014 13:22

The Cutrale offer closed yesterday...should get some news about the compensation soon.

[leebong] 25/11/2014 16:42

AT LAST THE share price RISES...now looking bullish.

[leebong] 24/11/2014 07:45

I agree with your reasoning...Cutrale actually have a very poor record for being a cheap labor employer, restricted work space per employee, health and safety at work and have been sued many times. They might asset strip Chiquita and sack a load of people.

We should hear about the compensation straight after the Chiquita takeover completes on December 3rd based on the legal agreement reached on the 17th August. That will be an interesting announcement.

[battlebus2] 23/11/2014 09:18

Don't trust the Cultrale guys to rush into paying us. Was there a date for payment?

[leebong] 23/11/2014 09:13

The Cutrale/ Chiquita buyout completes on December 3rd...the Chiquita CEO put his house up for sale for $3.8 million USD at auction last Tuesday. It will be interesting to see who he gets a job with. So we may hear about the $24 million USD compensation package in the next few weeks. I am hoping for a special dividend or at least a business plan of expansion.

[battlebus2] 21/11/2014 17:27

The buying continues a pace, lovely 300k buy today.

[leebong] 14/11/2014 11:11

Yep...the month long selling cycle has finished. We should hear some news about the $24 million USD compensation from Chiquita after December 3.

[battlebus2] 14/11/2014 11:01

MM's asking virtually full price now so any slack seems to have gone.

[leebong] 12/11/2014 16:47

Good to see the share price starting to recover...it will not take much to drive this back to a pound + as it's so undervalued.

[battlebus2] 12/11/2014 14:58

Good to see a tick up, i've noticed a couple of 150k buys over recent days.

[rjmahan] 09/11/2014 15:32

I was never convinced there were many synergies - how can two companies with very different geographies get substantial synergies - I think in a couple of years we will be glad the merger failed!

[battlebus2] 08/11/2014 12:04

Yes it may have taken a while to have realised those synergies. Thankfully we are more than profitable.

[leebong] 08/11/2014 11:37

Good news that the Chiquita Merger failed:

Chiquita sees quarterly boost in banana sales but posts loss

Chiquita Brands International Inc. sales inched up 2.2 percent for the third quarter, but the Charlotte banana company still reported a loss of $18 million, or 38 cents per share.

The loss equalled that of the third quarter in 2013 for Chiquita (NYSE:CQB). Sales increased to $739 million for the latest quarter, rising from $723 million a year earlier. That increase was propelled by a 4 percent rise in banana sales to $477 million, up from $458 million for the third quarter of 2013.

For the complete article read the following:

[leebong] 31/10/2014 03:03

Read this before BUYING FYFFES, target sp: EUR 1.50 – a 50-60% increase on the current price....very interesting stuff rjmahan

Ffyfes – You would have to be Bananas not to
30 Thursday Oct 2014
Posted by rjmahan in Uncategorized ≈ Leave a comment
More on FFyfes.

I think the fall in the share price post the collapse of the Chiquita deal is a buying opportunity. This is a solid, lowly geared company trading at a low multiple, it is also a strategic asset given its market share

Before I go into the detail on this a quick note on my history with Ffyfes – we have had a long and profitable relationship! I bought in 2010 at 0.32 EUR a share. I sold quite a bit at 1.11 EUR in May 2014 as the rise in price in the intervening four years meant my portfolio was ridiculously dominated by Ffyfes. Some portions of the holding were sold for a 244% gain!

In August and September I sold more as I wasn’t happy with becoming a shareholder in CQB. I was left with a rump holding – about 15% of the size of my FFY position at its maximum. On Monday I bought a lot more Ffyfes – taking it up to a 13% portfolio weight. I am keeping my powder dry to buy a little more should it fall to c0.85 EUR per share – probably up to a 15-18% weight.

I still think Ffyfes can do well. The price has fallen to around the same level as it was before the deal was announced. The market price is not taking into account the 3.5% of CQB’s value in any alternate deal break fee. I estimate that this is worth around 17.8m EUR – so 0.06 EUR per share. There will have been costs to the failed deal. At a guess say €5m – or 0.02 EUR per share. Still this is c 4% of FFY’s market cap.

I like Fyfes as it has lots of tangible assets. Bannana farms, planations, buildings that sort of thing. This amounts to 133.9m EUR net of intangibles – or 0.37 EUR per share – 40% of the current share price. The next question is – how accurate is that valuation. The answer is its very difficult to say – much of the plant is valued by the directors. The rest is much easier to value – Bannanas / other fruits. Quite a lot is in accounts receivable but looking in the accounts very little is past due and there shouldn’t be much risk – despite their problems the Tescos of this world aren’t going bust any time soon.

Then its a matter of looking at cashflow. In 2013 this amounted to EUR 27m. They bought a plantation so free cash flow was negative in 2013. To get an estimate of maintenance capex I will take the 2012 figure – so 6.2m EUR. This means if you buy Ffyfes today you receive a FCF yield of 7%. In reality the yield is higher – interims showed 36% YoY growth in EBITDA. If we assume FCF grows about 20% we get a FCF yield of 8.6%. Any takeover could be easily financed with Ffyfes own cashflow.

On a multiple basis too Ffyfes looks cheap – ignoring the overpriced dog that is Chiquita – Del Monte in the US – a much bigger, but similar business is trading at an estimated PE of 12.7 vs FFY at 8.6-9 vs likely 2014 FY figures (excluding any break fee payments). Even the veg related cousin of FFY – Total Produce is trading at a forward PE of about 10.8 based on the estimates I have available to me. In addition Total Produce doesn’t have Ffyfes asset backing. I think FFY should have more of the multiple of a growth stock – given solid EPS growth from EUR 0.02 in 2010 to EUR 0.10 for FY 2014 this isnt too far fetched. If you apply a healthier multiple of (say) 15 then you get a share price of EUR 1.50 – a 50-60% increase on the current price.

In addition I think this is a business I want to be in. Healthy food / fruit and veg I would suspect will outperform over the longer term. The health issues associated with packaged / processed food should be obvious to all and eventually I think people will act in their own best interest and eat more natural foods. I also suspect the rumbling supermarket price war (at least in the UK (c1/3rd of revenue) will help sales of fruit – supermarkets earn some of their highest margins on fruit and veg. It is of course possible they could push harder for lower margins to compensate – but I don’t think they will push any harder than they have in the past. I think FFY should have the multiple of a growth stock – given solid EPS growth from EUR 0.02 in 2010 to EUR 0.10 for FY 2014 this isn’t too far fetched.

Risks to my thesis are – bad harvests – all bananas are clones so their is risk of fungi / disease. Bad weather can cause losses – this is a low margin business – disruptions ie due to 2010 snow can cause losses. Tropical plantations are always risky – again due to weather.

FFY is owned by a diverse and uninteresting group of firms – not much exciting here.

Hopefully history will repeat and I will triple my money again. In reality I think the more likely option is this gets bought out.

Quick trading tip – go with the ISEQ if you can – spread is much lower than on the AIM listed shares.




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[rjmahan] 30/10/2014 21:49

New blog post on FFY - I think at these levels its a good buy again and have bought quite a bit more.....

hxxps://deepvalueinvestments.wordpress.com/2014/10/30/ffyfes-you-would-have-to-be-bananas-not-to/

[leebong] 30/10/2014 19:18

10/30/2014 10:14:00 AM
Coral Beach
Ed Lonergan, Chiquita CEO
The future of Ed Lonergan, Chiquita's CEO, and other company executives is unknown as the company prepares for the final stages of the buyout process initiated when the board of the banana giant unanimously agreed to sell Chiquita Brands International Inc. to two Brazilian companies.
After their shareholders rejected a merger with Fyffes Plc. by a margin of more than two to one, the Chiquita board of directors unanimously approved a buyout offer of $1.3 billion from two Brazilian companies.
The Oct. 24 vote showed almost 26 million shares voting against the Fyffes merger and less than 12.5 million shares in favor of the deal. Holders of more than 107,000 shares abstained from the vote, according to documents filed with the Securities and Exchange Commission.
Three days after the vote, Ed Lonergan, CEO of Chiquita Brands International Inc., Charlotte, N.C., issued a joint statement with officials of Brazil’s Cutrale Group and Safra Group saying the Chiquita board unanimously approved a buyout of $14.50 per share.
Cavendish Acquisitions Corp., established by the Brazilian companies to handle the buyout, is acquiring Chiquita’s debt, bringing the cash value of the deal to $1.3 billion. Officials said in the Oct. 27 news release they expect the transaction to close by the end of the year or in early 2015. It is not subject to any financing conditions.
Officials at Chiquita did not respond to questions regarding the future of top managers at the company. A spokeswoman for the Brazilian companies said Oct. 27 that such details remain to be resolved.
Chiquita will be a wholly-owned subsidiary of the Brazilian companies. It will remain incorporated in New Jersey, according to the joint news release.
Chiquita and Dublin-based Fyffes had been working on their merger since at least March. An unsolicited bid in August from Brazil’s juice giant Cutrale Group and investment bank Safra Group began a downhill slide for the deal.
The merger with Fyffes would have made the new company the top banana firm in the world’s $7 billion banana market.
“While we are convinced they would have been a strong merger partner, we will now go forward as competitors,” Lonergan said in a news release issued after the vote..
Chiquita had a termination clause in its negotiations with Fyffes and now must pay the Irish company 3.5% of its total market value. David Holohan, analyst for Merrion Capital of Dublin, told the Business Journal in Charlotte that the fee would be about $23 million.
When the Brazilians entered the picture with a $13 per share offer in August, Fyffes upped its offer. Ultimately Fyffes offered $13 per share and a larger interest — 59.6% — in the proposed ChiquitaFyffes company, which would have become the world’s top banana firm.

- See more at:

[leebong] 30/10/2014 16:10

Interesting article about Del Monte Banana Sales:

Fresh Del Monte Produce Inc. (FDP) stock closed 4.72% higher yesterday, following the release of better-than-expected profits for the third quarter of its fiscal year 2014 (3QFY14 ended September 26). However, the company failed to meet analysts’ expectation for quarterly revenue, even with the relatively better performance year-over-year (YoY).

Del Monte is one of the largest global producers of bananas and other fruit and vegetables. The company operates in four major segments. It derives over 80% of revenue from the sale of bananas and other fresh produce, while the rest of the revenue is streamed in from the Prepared Food segment.


Quarterly revenue came in at $884.6, representing an increase of 3% from $861 million recorded last year, missing analysts’ estimate of $886 million. Adjusted earnings per share (EPS) came in at 35 cents, up 289% from nine cents reported in the same quarter last year, staying ahead of analysts’ estimate of 34 cents.

According to Mohammad Abu-Ghazaleh, Chief Executive Officer and Chairman of Fresh Del Monte Produce, the strong performance for the quarter was majorly driven through the increase in sales volumes for bananas and other fresh produce. The surge was further complemented by the 3% increase in banana prices. He also said that the company was looking to diversifying its product line and expanding its distribution channels.

The increase in revenue was attributed to a 5.3% jump in revenue from the Banana segment to $423.8 billion, driven by 2% higher volume. Gross profit from the segment improved by 4.7% to $22 million as global banana prices increased by 47 cents to $14.77 per box. Higher prices were also complemented by lower distribution and ocean freight cost.

Revenue from the Fresh Produce segment was 1.3% YoY higher for the quarter, while gross profit from the segment came in flat. Amongst the Fresh Produce, the gold pineapple category pulled in 11.5% higher revenue at $130 million based on increased sales for Europe and North America. Net sales from the tomato category increased 12% to $24.8 million, while the net sales from fresh-cut category declined by 9% to $96 million.

However, the increase was partially offset by the 3.1% decline in revenue posted by the Prepared Food segment to $89.2 million, based on lower demand for its canned deciduous product line, further complemented by the declining demand for canned pineapples in the UK.

Gross profit for the quarter improved 49.4% to $73.9 million, while net profit improved 283% to $20.7 million. Gross profit margin expanded by 2.2 percentage points to 8.4%, while net profit margin expanded by 1.7 ppts to 2.3%.


For the upcoming quarter, analysts expect the company to post revenue of $873 million, representing a decline of 1% YoY, while the adjusted EPS is expected to break even, compared to a net loss per share of 35 cents in the comparable quarter last year.

For the full year, analysts expect the company to post adjusted EPS of $2.48, up 63% from $1.52 reported last year. Full-year revenue is expected to be $3.9 billion up 5% from $3.68 billion reported in previous year.

The company’s stock last closed at $31.08, representing a year-to-date gain of 10.33%, outperforming the S&P 500 Index’s return of 7.8%.



So sales for Fyffes should compare well with Del Montes rise in banana sales and profit margin...perhaps the company would be a very good merger target with Fyffes.

[knighty0001] 29/10/2014 12:56

Investali = bellend