Chiquita may take partner in Great White Fleet
Chiquita Brands International said Monday that in an effort to boost shareholder value it might sell its overseas shipping and shipping-related logistics operations and partner with a company that has shipping as its core business.
“Our Great White Fleet has represented a strong competitive advantage for Chiquita for many years, and continuing to excel in cold-chain management'delivering our high-quality fresh products quickly and efficiently'will remain critical to our company,' Chiquita chairman and CEO Fernando Aguirre said in a prepared statement. 'However, we believe there is an opportunity to enhance shareholder value while maintaining high quality and competitive long-term operating costs by partnering with an expert shipping service provider that can grow with Chiquita. This would allow us to focus our efforts and resources even more on strengthening customer relationships and providing healthy, fresh foods to consumers. In addition, an asset sale would generate significant capital, which would be used primarily to reduce debt, as well as to invest in new growth opportunities.'
Chiquita said it had been evaluating its options for several months, and has now decided to launch the process of exploring strategic alternatives with respect to its shipping and logistics operations. Chiquita is a major tenant at Port Everglades, which is one of it main U.S. entry points for fruits produced primarily in Central America.
The company said it is considering various structures, including the sale and lease-back of the company’s owned ocean-going shipping fleet, the sale and/or outsourcing of related ocean-shipping assets and container operations, and entry into a long-term strategic partnership to meet all of Chiquita’s international cargo transportation needs.
Chiquita said it has been working with Fortis Securities, a leading global corporate and investment bank to the maritime industry, as a financial advisor to support the exploration of strategic alternatives.
In addition to the announcement about its shipping operations, Chiquita said the company’s quarterly cash dividend of $0.10 per share was being eliminated. Chiquita intends to redirect the approximately $17 million in annual funds that otherwise would have been allocated for dividends 'to reduce debt and enhance financial flexibility.'
