Why Shares of Chiquita Brands International, Inc. Were Shining Today

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Chiquita Brands International, Inc.  (NYSE: CQB  ) were looking ripe today, climbing as much as 19% after announcing a merger with Fyffes, a produce company based in Ireland.

So what: The merger will create a new company known as ChiquitaFyffes, 50.7% of which will be owned by Chiquita shareholders and the remaining 49.3% to be owned by Fyffes shareholders, though the two brands will continue to operate separately. The companies said the combination would create the No. 1 banana company globally, with a 14% market share, and would lead to $40 million in annual cost savings and synergies and allow further opportunities to improve operational leverage. 

Now what: The deal will be subject to the usual regulatory scrutiny, but analysts expect the merger to go through as the companies primarily deal in different parts of the world, Chiquita in North America and Fyffes in Europe. Investors on both sides clearly seem to approve of the merger as Fyffes' shares jumped 44% on the news, but several analysts said the deal is reflective of weakness in the industry and could prompt further consolidation. Merging two corporate cultures is also sometimes rougher than expected. Chiquita and Fyffes expect the deal to close by the end of the year. 

The best way to invest
One of the dirty secrets that few finance professionals will openly admit is the fact that dividend stocks as a group handily outperform their non-dividend-paying brethren. The reasons for this are too numerous to list here, but you can rest assured that it's true. However, knowing this is only half the battle. The other half is identifying which dividend stocks in particular are the best. With this in mind, our top analysts put together a free list of nine high-yielding stocks that should be in every income investor's portfolio. To learn the identity of these stocks instantly and for free, all you have to do is click here now.


Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2871004, ~/Articles/ArticleHandler.aspx, 9/19/2014 12:11:46 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement