Irish fruit producer Fyffes will be bought by with Japanese industry giant Sumitomo, in a deal worth €751 million.
The Japanese company agreed to pay €2.23 euro per share, representing a 49 percent increase on Fyffe’s closing price on Thursday and sending shares up over 40 percent.
Fyffes is one of the biggest Irish companies producing and shipping bananas, melons, pineapples and mushrooms, after it acquired up Canada’s All Seasons Mushrooms in a €41 million deal earlier this year.
27 percent of shareholders have already backed the deal. Commenting on the acquisition, David McCann, Chairman of Fyffes said:
“We believe this transaction represents a compelling proposition for our shareholders and crystallises the substantial value created in recent years through the various strategic developments and the strong operating performance of our Group. Our employees, customers, suppliers and joint venture partners will benefit from Fyffes being part of an enlarged group with greater scale, reach and resources to broaden and accelerate delivery of Fyffes’ strategic objectives.”
Fyffes employs more than 17,000 people worldwide and has an annual turnover of €1.2 billion. Sumitomo is one of the largest fruit companies in Japan, supplying one in three bananas sold in the country.
Hirohiko Imura, Representative Director, Managing Executive Officer of Sumitomo, commented:
“Sumitomo Corporation has long admired Fyffes for its outstanding track record and market leading position, and we are delighted that the Fyffes Directors have unanimously agreed to recommend our offer to shareholders. We believe that our offer represents a great reward for Fyffes’ shareholders. We are grateful that the McCann family has provided an irrevocable commitment of support and is entrusting us to continue with them the rich Fyffes heritage. Sumitomo will provide Fyffes with experience, support and investment to continue to build on the tremendous Fyffes skills and experience and reach greater potential.
“We have significant experience in the produce sector and look forward to working with Fyffes’ executive directors, senior management and employees, customers and other stakeholders to strengthen Fyffes’ already impressive market position through continued investment. We look forward to working with the Fyffes team to further develop the business over the longer-term and to expanding into new markets to better serve customers.”
Fyffes plc (LON:FFY) are currently up 44.8 percent at 186.90 (1000GMT).