Cutrale Group and Safra Group have filed a proxy statement urging Chiquita shareholders to vote against the Chiquita-Fyffes merger and in favour of a takeover by the Brazilian groups when the decision is put to shareholders at a specially formed meeting on 17 September.
A letter has been sent out to Chiquita shareholders along with the Cutrale-Safra proxy statement, building on the preliminary proxy materialsfiled to the US Securities and Exchange Commission (SEC) on 18 August.
Chiquita earlier rejected Cutrale-Safra’s unsolicited proposal of a US$661m take over of the US-based banana company and instead upheld its commitment to merge with Irish company Fyffes.
Cutrale-Safra have said their proposal is “unquestionably superior” to that offered by Fyffes, despite Chiquita rejecting the bidon the groundsthat it was “inadequate and not in the best interests of Chiquita shareholders.”
The extensive document breaks down both mergers, pushing its own $13-per-share takeover as far superior to the Fyffes offer, which it says offers Chiquita shareholders no operational control and exposes the company to substantial risks.
The letter said that Chiquita shareholders will gain no premium with the Fyffes merger, that Chiquita’s stock has declined 7.2 per cent since announced the Fyffes merger in March, while Fyffes stock price rose 21 per cent in the same period.
It also said that Chiquita’s Board has a record of poor decision-making, and casts doubt on the credibility of the Board.
Chiquita’s Board recommends Fyffes merger
Chiquita has also filed a presentation with the SEC urging its shareholders to vote in favour of the proposed transaction with Fyffes at the upcoming meeting.
Chiquita’s board of directors unanimously recommended the Fyffes merger, which it said will create a global banana company generating US$4.2bn in revenue annually.
In a letter to its shareholders, Chiquita stressed that shares could rise above the proposed $13-per-share take over bid by Cutrale-Safra if the Fyffers merger goes ahead. It labeled Cutrale-Safra’s offer as “not a compelling alternative to ChiquitaFyffes as it limits the ability of Chiquita shareholders to realise long-term value.”
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