Chiquita Brands International (NYSE: CQB) has backed down from its firm stance against a proposed merger from two Brazilian companies, giving them the green light to conduct focused due diligence and present a final offer.

Brazilian juice company the Cutrale Group and global investor the Safra Group, through their subsidiary Cavendish Group, made a US$611 million offer in August and have urged Chiquita shareholders to vote against an existing merger deal in the works with Ireland's Fyffes Plc (ESM: FFY).

A special meeting of shareholders to vote on the ChiquitaFyffes transaction was due for Sept. 17, but Chiquita has proposed that it be postponed until Oct. 3, unless the Irish High Court has any objections.

While Chiquita is now giving Cavendish the opportunity to make another proposal, it still recommends shareholders vote for the Fyffes deal.

The company added that Fyffes has granted Chiquita a waiver that permits Chiquita to engage in discussions with Cutrale and Safra.

NGO Banana Link and the Latin American Banana Worker Syndicate Coordinator (COLSIBA) have expressed concerns about what a Chiquita takeover would mean for social corporate responsibility, given Cutrale's unsavory labor rights track record on Sao Paulo citrus farms.

COLSIBA coordinator Gilbert Bermúdez described Cutrale as a "very aggressive" group that did not show respect for labor rights, that had been convicted by Brazilian courts for illegal outsourcing, had been fined for discriminating against pregnant women, and that had been charged with having poor conditions in worker housing; all cases that have occurred within the last two years.

Banana Link international coordinator Alistair Smith told www.freshfruitportal.com that a takeover of Chiquita by Cutrale and Safra threatened to jeopardize 15 years of the multinational's efforts to 'put its house in order' in terms of social dialogue and relations with its workforce.

www.freshfruitportal.com