Sorry, President Obama. It looks like Chiquita might be doing a tax inversion after all. The popular banana brand rejected Brazilian juice maker Cutrale and financial conglomerate Safra Group’s $611 billion takeover bid on Thursday, calling the purchase price “inadequate,” reports Reuters.
While Cutrale and Safra said they were “extremely disappointed,” Chiquita noted that it was indeed moving ahead with its plans to merge with Irish fruit and produce company Fyffes. Had Chiquita accepted the Cutrale/Safra offer, the Fyffes’ deal, which would involve Chiquita moving its tax domicile overseas, would most likely not have happened.
Chiquita investors reacted negatively to the news, dropping Chiquita Brands’ shares 1.2% in aftermarket trading. The stock partially recovered today, having risen 0.6% at 2:50 p.m.
In March, Chiquita said it would pay $526 million for Fyffes in an all-stock transaction. According to Reuters, the combined market value of both Chiquita and Fyffes is near $1 billion. The deal will create the largest banana company in the world.
In addition to rejecting Safra and Cutrale’s bid, Chiquita also said that it would not hold additional talks with either firm “at this time” nor would Chiquita release any financial information to them.
Photo: Flickr user UggBoy UggGirl, CC BY 2.0