Juice maker Cutrale and investment firm Safra Group filed a proxy statement with the Securities and Exchange Commission Aug. 14 asking shareholders of Charlotte, N.C.-based Chiquita to reject Chiquita’s proposed merger with Dublin-based Fyffes PLC.
The proxy statement comes in advance of a Sept. 17 Chiquita shareholders meeting in Charlotte.
The Brazilian companies made the SEC filing shortly after Chiquita rebuffed their offer, announced Aug. 11, to buy Chiquita’s outstanding common stock for $13 per share.
As of Aug. 21, the filing had not changed Chiquita’s resolve to go forward with its merger plans, said Ed Loyd, a company spokesman.
“Chiquita remains committed to completing its transaction with Fyffes, which we believe will create a combined company that is better positioned to success in a highly competitive marketplace, while driving strong performance and value for shareholders,” Loyd said.
Cutrale and Safra Group’s offer, Loyd said, is “inadequate and not in the best interest of Chiquita shareholders.”
The Brazilians’ offer came as Chiquita and Fyffes wait for their shareholders to approve their merger and for final regulatory approval of the deal. The proposed $1 billion merger took a step forward June 2 with the expiration of a waiting period for U.S. antitrust review of the deal.
In its SEC filing, Cutrale and Safra Group said it made more financial sense for shareholders to reject the merger with Fyffes and consider a buyout instead.
The filing does not, however, ask shareholders to approve a buyout. Instead it asks shareholders to vote for an adjournment proposal.
“We believe the proposed combination of Chiquita and Fyffes does not provide adequate value to Chiquita shareholders,” the filing states. “Our $13 per share all-cash proposal is a superior alternative for Chiquita shareholders because, among other things, it provides significantly greater financial value and more certain value to Chiquita shareholders than the proposed combination with Fyffes.”
Cutrale and Safra Group’s bid was 29% higher than Chiquita’s closing stock price on Aug. 8. Shares of Chiquita rose more than 30% Aug. 11 in response to the Brazilians’ offer, and shares of Fyffes fell 13%.
Also in the filing, Cutrale and Safra criticized Chiquita for not communicating with the companies before rejecting their offer.
“We strongly believe that it is inconsistent with the Chiquita board’s fiduciary duties under applicable law not to furnish information to or engage in discussions or negotiations with us, given that the Cutrale-Safra proposal provides greater and more certain value to Chiquita’s shareholders than the Proposed Fyffes Combination,” the filing states.