(Adds background, statement from Cutrale and Safra, Fyffes’ declining comment)
SAO PAULO, Oct 21 (Reuters) - Shareholders of Chiquita Brands International Inc. should consider alternatives to a proposed merger with Irish produce firm Fyffes Plc, proxy advisory firm Glass Lewis said on Tuesday.
Brazilian juice maker Grupo Cutrale and investment firm Safra Group joined together to make an all-cash bid of $14 for each Chiquita share, valuing the company at about $658 million, but Chiquita’s board rejected the offer.
Shareholders are set to vote on Fyffes’ revamped all-stock offer of $11.80 per Chiquita share at a special meeting on Oct. 24.
Glass Lewis said Chiquita’s board “continues to rely primarily on assumptions-driven analyses” of the combined entity’s net present value.
“We expect shareholders may reasonably be left questioning whether the amended Fyffes transaction ... represents an opportunity so compelling as to soundly preclude exploration of any other alternatives, including remaining a stand-alone entity,” Glass Lewis said.
Cutrale and Safra said in a statement they are pleased with the Glass Lewis recommendation and that their offer provides Chiquita shareholders with a “superior and compelling alternative.”
Fyffes’ representatives declined to comment.
On Monday proxy advisory firm Institutional Shareholder Services (ISS) recommended Chiquita shareholders vote in favor of the Fyffes deal.
In a reversal of a previous stance made public in September, ISS said Fyffes’ revamped offer, while lower than the Cutrale-Safra offer, would give Chiquita shareholders more control of the combined company.
Chiquita shares rose 1.48 percent to $12.99 on Tuesday, while Fyffes shares were down 0.97 percent to 1.02 euros. (Reporting by Guillermo Parra-Bernal and Conor Humphries; Writing by Asher Levine; Editing by Chizu Nomiyama and Paul Simao)