Boston, MA 08/27/2014 (wallstreetpr) – According to a financial release published by the Chiquita Brands International Inc (NYSE:CQB), the company and FYFFES PLC ORD (OTCMKTS:FYFFF) declared the updated expected annualized pre-tax cost synergies for the planned amalgamation of the companies.
Additional synergies
Fyffes and Chiquita have recognized an extra $20 million of synergies for a sum of at least $60 million, to be yielded by the deal, in annualized pre-tax cost synergies by the end of 2016.
The company re-confirmed
According to a news report in Reuters, Chiquita Brands International Inc (NYSE:CQB) has “re-affirmed” its commitment for a merger with FYFFES PLC ORD (OTCMKTS:FYFFF), an Irish tropical fruit company.
Earlier proposal rejected
Earlier in August, Chiquita Brands International Inc (NYSE:CQB) rebuffed a rival buyout proposal. Cutrale, a Brazilian juice maker, and a banking plus real estate organization, the Safra Group offered a bid to takeover Chiquita.
Joint statement
The chief executive officer of Chiquita, Ed Lonergan, in a joint statement, stated that FYFFES PLC ORD (OTCMKTS:FYFFF) and Chiquita Brands International Inc (NYSE:CQB) is still committed to the deal and are therefore continuing to operate together in order to conclude the combination as quickly as possible.
The executive chairman of Fyffes, David McCann, and the chief executive officer of Chiquita, Ed Lonergan, in the statement, revealed that both the companies could identify an added $20 million owing to the companies’ intent as well as meticulous integration planning endeavours. Such additional synergies would allow the combination to offer greater value to the shareholders. Also, the merged company would have a stronger stance with more earnings power.
The yield of the deal
Both FYFFES PLC ORD (OTCMKTS:FYFFF) and Chiquita Brands International Inc (NYSE:CQB) believe that almost half of the $60 million of synergies are accruable in the very first year after the merger concludes, while the remaining is achievable by the end of the second year. Also, these will have a significant positive effect on the combination’s financial profile as the merged company is anticipated to create substantial and increased free cash flow.
