US fruit company Chiquita have teamed up with Irish rival Fyffes, Europe largest distributor, to become the world’s biggest banana supplier.
With the $1 billion tie-up, the new company is expected to sell about 160 million boxes of bananas every year.
ChiquitaFyffes will have an operating presence in over 70 nations and a workforce of about 32,000 people.
“This is a milestone transaction for Chiquita and Fyffes that brings together the best of both companies,” said Chiquita Chief Executive Ed Lonergan.
In the tie-up, investors will get shares in each company, with Fyffes stockholders owning as much as 49.3% of the merged firm.
“The first three [companies] on a global scale are not too far away from each other, whereas Fyffes was a good deal smaller. Now a firm number one has been created, there will be some impetus for further consolidation in the sector,” said Merrion Stockbrokers analyst David Holohan.
The deal creates a strategic partnership that combines two companies that will work to bring the best practices in countries where they operate.