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magazineFyffes goes bananas on Japan buyout
Fyffes (FFY:AIM) 186p
Gain to date: 44.4%
Original entry point: Buy at 128.8p, 22 Sept 2016
Readers who followed our buy call on tropical produce distributor Fyffes (FFY:AIM) are sitting on a tasty 44.4% profit. This follows the recommendation (9 Dec) of a €751m takeover by Japanese conglomerate Sumitomo for the Dublin-headquartered bananas, pineapples and melons marketer.
Sumitomo is offering €2.23 per share (187p at latest exchange rates) in cash to grab the world’s oldest fruit brand and the fact the shares trade at or around the bid price suggests a counterbid is unlikely. As such, investors should sell in the open market in case this offer should fall through.
The offer price not only represents a juicy 49% premium to the undisturbed share price, it is also a 37% premium to Fyffes’ all-time high of €1.62 reached in April.
Shareholders will receive a €0.02 dividend for the 2016 financial year, bringing the total amount to €2.25 per share. (JC)
Investors should bank their 44.4% profit and sell in the open market.
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