Chiquita
will overtake its competitors by acquiring the Fyffes, Ireland's
company that distributes fruit across Europe. Chiquita will pay about
$526 million for Fyffes. It will be named ChiquitaFyffes.
The
combination of a strong presence in United States market with the
Fyffes acquisition, will turn Chiquita in a global producer and
distributor of bananas. The expected annual revenues will be about
$4.6 billion, shipping 160 million boxes of banana a year
The new company will take advantage of its new multinational status: will be located in Ireland in order to make profit of low tax and will save costs due to its vast distribution net. Only eliminating duplication shipping, the company expect to save about $40 million at the end of 2016
Today,
Chiquita employs about 20.000 people in 70 countries and Fyffes
employs about 12.000 (New York Times)
This
is a good example of a global producer and distributor. After the
expansion of supermarket mergers, big fruit companies have lost their
power of negotiation. This a strategic response to regain market
power.
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