The Brazilian investors trying to acquire Chiquita Brands International (NYSE: CQB) have lashed out at the company and its potential partner-to-be Fyffes Plc (ESM: FFY), describing a recently revised merger arrangement as just another attempt to dupe shareholders.

Photo: Fernando Stankuns, via Flickr Creative Commons

While the new deal would give Chiquita shareholders a greater stake in the ChiquitaFyffes group, suitors Cutrale Group and Safra Group said in a release that it was still not as good as their offer.

"The revised Chiquita Fyffes transaction values the combined entity at $11.82 per share, based on unaffected stock trading prices, which is well below the $13 all cash certain Cutrale-Safra proposal," the two companies, making the offer under subsidiary Cavendish Group, said.

"The board's action to revise the Fyffes transaction agreement, with a substantially increased break-up fee to Fyffes but without warning to Cutrale-Safra and before Cutrale-Safra has had the opportunity to submit a revised proposal based on its due diligence, will do nothing more than cost the Chiquita shareholders money.

"Fyffes continues to use a game plan of trying to hoodwink Chiquita investors with ongoing rejiggered [sic] information, ranging from suddenly found cost savings to "illustrative" stock price valuations to rescrambled combination terms. None of this can disguise the fact that the Chiquita--Fyffes combination is highly flawed and fraught with risks for Chiquita shareholders."

In the release, Cavendish urged Chiquita investors to read the Cutrale-Safra Proxy as well as any other relevant documents filed with the U.S. Securities and Exchange Commission, because they "contain (or will contain) important information".

The Safra Group has more than US$200 billion worth of assets under management and aggregate stockholder equity of around US$15.3 billion, running a range of businesses across five continents. The Cutrale Group is a leading agribusiness and juice company, accounting for more than one third of the world's US$5 billion orange juice market with ventures also in apples, peaches, lemons and soybeans.

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