In switch, Chiquita and Fyffes say they need European Commission’s OK for merger
04/29/2014 9:58 AM
04/29/2014 11:28 AM
Charlotte-based Chiquita Brands International said Tuesday that the company will need the approval of the European Commission, the governing body of the European Union, to complete its combination with Irish produce company Fyffes.
Announced last month, the all-stock deal would give Chiquita shareholders just over half of the combined company, called ChiquitaFyffes. But the new company would be based in Dublin, Ireland, where its CEO and other top executives would be based. Some senior executives and hundreds of corporate employees would remain in Charlotte.
The companies had originally said the deal would not meet the threshold for review by the European Commission. But Tuesday, Chiquita said in a securities filing that “following an examination of additional data, including data made available by third parties,” the company realized that the European Commission does have jurisdiction over the deal.
Chiquita and Fyffes still intend to close the deal by the end of the year, the companies said.
The combination has called into question the incentives deal that Charlotte, Mecklenburg County and North Carolina built to lure Chiquita away from Cincinnati.
The biggest chunk of incentive money promised to Chiquita, more than $16 million, comes from a 75 percent state rebate on payroll taxes for the Charlotte employees. The company also received a $2.5 million state grant and $2.5 million worth of incentives from Charlotte and Mecklenburg County.
One of the requirements for the incentives was keeping the company’s headquarters in Charlotte for 10 years. City officials were scheduled to meet with the company this week to discuss the incentives deal.
Chiquita is set to report its quarterly earnings next week.
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