Chiquita sticker on banana

The Cutrale-Safra combination currently aiming to takeover Chiquita has made its latest move in its ongoing bid to turn the US group's shareholders off the merger with Irish group Fyffes, highlighting that two leading proxy advisory firms – Glass Lewis & Co LLC and Egan-Jones – have recommended to their subscribers to not vote for the Fyffes transaction and to vote to adjourn the special meeting of Chiquita shareholders on 17 September.

“We believe reasonable observation of the extant circumstances suggests few investors share the board's optimistic view on the value of the Fyffes combination,' the two advisory firms stated. “From this position, however, the Chiquita board elects to employ methodologies, which, in our opinion, inappropriately cloud the appeal of engaging with Cutrale/Safra.

“We believe the board has failed to credibly establish that the Fyffes merger of equals deal is so clearly compelling – or, perhaps more significantly, that the Cutrale/Safra take out offer is so clearly inferior – that shareholders should effectively forego extensive exploration of any potentially superior alternatives,' they continued. 'To the contrary, following an extensive review of the available arguments, we find the board relies quite heavily on estimated NewCo values unsupported by market trends, questionable methodologies intended to undermine the perceived value of the Cutrale/Safra bid and an adamant commitment to press its own deal forward despite potential greater options are available to Chiquita”.

Summarising, the advisors said shareholders should not support the Fyffes merger, and recommended that they vote to adjourn the special meeting on 17 September – a move the Brazilians backed.

'The Chiquita board needs to stop supporting a transaction that provides inferior value to Chiquita shareholders and enter into discussions with Cutrale-Safra,' the two groups added. 'The Cutrale-Safra Negotiation Proposal provides Chiquita shareholders a risk free option with unquestionably superior value.'