March 13, 2014

Banana giants merge to form world’s No 1

Two of the world’s biggest banana companies, the US-based Chiquita and the Irish company Fyffes, are to complete a merger by the end of 2014 to form what will be the world’s largest conglomerate in the banana business.{{more}} The new company, to be called Chiquita/Fyffes, will have annual revenues of US$4.6 billion, operate in 70 countries around the globe and employ about 32,000 workers. In addition to bananas, pineapples, melons and packaged salads will be among major products.

Both of the merging companies have historically had impact on the banana business in the Windward Islands. Chiquita had led the ‘banana war’ against the European Union in the nineties, which led to the dismantling of the preferential access to the European market enjoyed by Windward Islands’ and African producers. As a result, the company gained infamy in the islands, best exemplified in St Vincent by a huge educational and mobilization campaign, led by the popular late radio announcer Glen Jackson.

Fyffes had had long links with Caribbean producers, especially in Belize, Jamaica and Suriname and is a partner with WINFRESH, the exporting company owned by the governments of the Windward Islands, in a joint venture, which includes shipping. Current executive chairman of Fyffes David McCann is to be the new chief executive officer of the merged company, which will have its headquarters in Ireland.

Commenting on the merger, Banana Link, one of the leading European organizations campaigning on banana issues, had this to say:

“The news that Chiquita and Fyffes are to merge, is doubtless a reflection of the way that the banana market has been going for the last 15/20 years. Two big fruit companies have felt the downward pressure of the big retail buyers on their margins and consolidation appears to them to be a strategy for survival. Historically, the two companies were linked, but since the 1980s they have been competitors. The need for consolidation in the face of huge retail buyer power would appear to be the main driver in this merger.

“It is hoped that the banana companies will reinforce their corporate responsibility programmes and take a very active role in the industry’s multi-stakeholder debates within the world Banana Forum around how to achieve a genuinely sustainable banana economy.”