Chiquita completes acquisition of Fresh Express
Chiquita completes acquisition of Fresh Express
Chiquita Brands International Inc., based in Cincinnati, announced June 28 that it has completed its acquisition of the Fresh Express unit of Richmond, VA-based Performance Food Group. The purchase price was $855 million.
The deal, which was first announced in February, was supposed to close in April. But citing legal matters involving the conduct of some of its employees, Chiquita announced April 25 that the acquisition would be delayed for up to two months.
At the time there was speculation that the deal would fall through, with some in the industry questioning whether Chiquita would be able to secure the financing. But the June 28 announcement would seem to put to rest any doubts.
With the acquisition of Salinas, CA-based Fresh Express, which owns a 40 percent retail marketshare of packaged salads generating $1 billion in annual revenues, Chiquita immediately becomes the leader in the fast-growing value-added salads category.
"Fresh Express fits well into our sustainable growth strategy as we continue to focus on satisfying the primary consumer needs of health, taste and convenience," Fernando Aguirre, Chiquita's chairman and chief executive officer, said in a statement. "The acquisition, which we expect to be accretive in the first 12 months, will help us diversify our business and improve the quality of our earnings.
Mr. Aguirre continued, "Chiquita and Fresh Express bring complementary, best-in-class business practices and proprietary technologies that will add value across the supply chain. We expect this to result in increased sales, reduced costs and strong bottom-line performance for Chiquita as well as our trade customers.
PFG, which purchased Fresh Express in 2001 for about $290 million, said that it will focus entirely on its core broadline and customized foodservice distribution businesses, according to Robert Sledd, chairman and CEO of PFG.
In a separate development, PFG said that it will spend as much as $315 million to buy back 10 million, or roughly 21 percent, of its outstanding shares through a Dutch auction tender offer, according to a June 28 Associated Press report.
Performance Food, which supplies food to restaurants, schools and hospitals, said that it will buy back the shares at a price between $27.50 and $31.50 per share.
Under the Dutch auction, shareholders specify a price within the range at which they want to sell their shares. After receiving all offers, Performance Food will select the lowest price within the range that will permit it to buy back the desired number of shares.
The deal, which was first announced in February, was supposed to close in April. But citing legal matters involving the conduct of some of its employees, Chiquita announced April 25 that the acquisition would be delayed for up to two months.
At the time there was speculation that the deal would fall through, with some in the industry questioning whether Chiquita would be able to secure the financing. But the June 28 announcement would seem to put to rest any doubts.
With the acquisition of Salinas, CA-based Fresh Express, which owns a 40 percent retail marketshare of packaged salads generating $1 billion in annual revenues, Chiquita immediately becomes the leader in the fast-growing value-added salads category.
"Fresh Express fits well into our sustainable growth strategy as we continue to focus on satisfying the primary consumer needs of health, taste and convenience," Fernando Aguirre, Chiquita's chairman and chief executive officer, said in a statement. "The acquisition, which we expect to be accretive in the first 12 months, will help us diversify our business and improve the quality of our earnings.
Mr. Aguirre continued, "Chiquita and Fresh Express bring complementary, best-in-class business practices and proprietary technologies that will add value across the supply chain. We expect this to result in increased sales, reduced costs and strong bottom-line performance for Chiquita as well as our trade customers.
PFG, which purchased Fresh Express in 2001 for about $290 million, said that it will focus entirely on its core broadline and customized foodservice distribution businesses, according to Robert Sledd, chairman and CEO of PFG.
In a separate development, PFG said that it will spend as much as $315 million to buy back 10 million, or roughly 21 percent, of its outstanding shares through a Dutch auction tender offer, according to a June 28 Associated Press report.
Performance Food, which supplies food to restaurants, schools and hospitals, said that it will buy back the shares at a price between $27.50 and $31.50 per share.
Under the Dutch auction, shareholders specify a price within the range at which they want to sell their shares. After receiving all offers, Performance Food will select the lowest price within the range that will permit it to buy back the desired number of shares.
