Brazil bidders derail huge Chiquita-Fyffes banana merger

 A last-minute increased offer by Brazilian juice exporter Cutrale Group and investment bank Safra derailed banana giant Chiquita's plans to merge with European rival Fyffe's on Friday.
Chiquita shareholders voted down the merger, which would have created the world's largest banana trader, opening the way for the Brazilian duo to take over the iconic US firm in a deal worth more than $680 million.
A takeover would propel Cutrale, which claims a one-third share of the $5 billion global orange juice market, into the top ranks in the global fruit and vegetable trade.
Chiquita and Fyffes had announced their deal in March, with the US company aiming to reap the tax advantages of moving its domicile to Fyffe's home base in Ireland in a controversial inversion deal.
The administration of President Barack Obama has expressed strong opposition to such deals, in which US companies claim new foreign ownership and relocate their statutory domicile to low-tax locations like Ireland. Meanwhile they leave their operating headquarters inside the United States.
In August Cutrale and Safra joined together to submit an unsolicited $14 a share bid, which was immediately rejected by Chiquita's board.
After European Union competition regulators gave a green light earlier this month to the Chiquita-Fyffes deal, Chiquita scheduled a shareholders vote for Friday.
But Thursday Cutrale and Safra increased their cash offer to $14.50 a share, arguing to investors that it was worth 20 percent more than a Chiquita-Fyffes merger, and would mean an immediate payoff.
Again Chiquita's board recommended against the offer, but shareholders voted clearly in favor of it Friday morning.  
"Given today's results, we have determined to terminate the agreement with Fyffes and to engage with Cutrale/Safra regarding its revised offer," said Chiquita president and chief executive Edward Lonergan.
"While we are convinced (Fyffes) would have been a strong merger partner, we will now go forward as competitors."
After jumping 7.7 percent Thursday on the higher Cutrale/Safra offer, Chiquita shares rose another 3.7 percent to $14.27 in late-morning Friday trade.