Chiquita Brands Reaches Restructuring Agreement
Nov 14, 2001 12:00 PM, Refrigerated Transporter Staff
In agreement that will give debt holders almost 88% of the banana importer’s equity, Chiquta Brands International Inc will file for Chapter 11 bankruptcy with a prearranged plan for reorganization. Chiquita has lost more than $1.5 billion in a dispute over banana imports into the Eurpoean Union during the past eight years. The dispute has been settled. Bankruptcy will restructure roughly $861 million in debt, cutting debt and interest by $700 million and reducing expenses $60 million a year. The company will issue 40 million new shares that involve only publicly held debt and Chiquita equity. The vast majority of this new stock will go senior debt holders. Chiquita’s stock closed well below $1 on Friday November 9, and trading was halted early on November 12, but began trading again shortly thereafter.
