Shares in the Irish fruit and fresh produce company Fyffes surged by 29% in Dublin this morning, after the announcement that they are to merge with Chiquita to create world's largest banana supplier.
The new company will be called ChiquitaFyffes plc and will be listed on the New York Stock Exchange.
The companies say that both the Chiquita and Fyffes brands will continue to be sold separately. It has been reported that as a result of the deal Chiquita shareholders will own about 50.7% of ChiquitaFyffes, and Fyffes shareholders will own approximately 49.3% of the n newly created company.
Chief executive officer of Chiquita, Ed Lonergan, will serve as chairman of the new group and Fyffes executive chairman David McCann will become CEO.
The senior executives will be located in corporate offices in Charlotte, North Carolina and Dublin, Ireland.
Ed Lonergan said that the deal was a “milestone transaction” which “brings together the best of both companies," and the transaction will be completed by the end of the year.
“We will maintain our brands, all of which are valued by both customers and consumers. The combined company will also be able to provide customers with a more diverse product mix and choice," he added.
It is estimated that the new company will have about €3.3 billion worth of annual revenues.
In related news, Fyffes published their annual financial results for 2013 this morning, which showed a 6.3% increase in sales to €1.1 billion.
EBITA grew by 6.9% to €32.7 million, and pre-tax profits at Fyffes rose by 5% in 2013 to €28.7 million.
© 2014 - European Supermarket Magazine by Enda Dowling
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