Rule 424(b)(3)
Registration No. 33-58705
PROSPECTUS
330,000 Shares
Chiquita Brands International, Inc.
Common Stock
This Prospectus relates to up to 330,000 shares of the Capital
Stock, $.33 par value (the "Common Stock"), of Chiquita Brands
International, Inc. ("Chiquita" or the "Company").
The Common Stock is listed on the New York, Boston and Pacific
Stock Exchanges. On April 25, 1995 the last sale price of the
Common Stock as reported on the New York Stock Exchange Composite
Tape was $13.625 per share.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The shares of Common Stock offered hereby (the "Shares") are
being sold for the account of and by the person named under the
caption "Selling Shareholder." The Shares may be sold from time to
time in transactions on the open market or in negotiated
transactions, in each case at prices satisfactory to the seller.
(See "Plan of Distribution.") The Company will not receive any
proceeds from any sales of the Shares.
See "Investment Considerations" for a discussion of certain
factors which should be considered by prospective purchasers of the
Common Stock.
The date of this Prospectus is April 26, 1995.
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AVAILABLE INFORMATION
Chiquita is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"),
and in accordance therewith files reports, proxy and information
statements and other information with the Securities and Exchange
Commission (the "Commission"). Chiquita has filed with the
Commission a Registration Statement under the Securities Act of
1933, as amended (the "Securities Act"), with respect to the Shares
offered hereby. This Prospectus does not contain all the
information set forth in the Registration Statement and exhibits
thereto, or amendments thereto, to which reference is hereby made.
Such reports, proxy and information statements, Registration
Statement and exhibits and other information filed by Chiquita may
be inspected and, upon payment of the Commission's customary
charges, copied at the public reference facilities of the
Commission at Room 1024, Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549, and at the Regional Offices of the
Commission at Suite 1300, 7 World Trade Center, New York, New York
10048, and at Suite 1400, Northwestern Atrium Center, 500 West
Madison Street, Chicago, Illinois 60661.
Chiquita's Common Stock is listed on the New York, Boston and
Pacific Stock Exchanges. Reports, proxy and information statements
and other information concerning Chiquita may be inspected and
copied at the Library of the New York Stock Exchange at 20 Broad
Street, New York, New York; at the Secretary's Office of the Boston
Stock Exchange at One Boston Place, Boston, Massachusetts; and at
the Listing Department of the Pacific Stock Exchange at 301 Pine
Street, San Francisco, California.
No person has been authorized to give any information or to
make on behalf of the Company or the Selling Shareholder any
representations, other than those contained in this Prospectus, in
connection with the offer made hereby, and, if given or made, such
other information or representation must not be relied upon as
having been authorized by the Company or the Selling Shareholder.
This Prospectus does not constitute an offer to sell, or a
solicitation of an offer to buy, any security other than the
securities offered hereby, or an offer to sell or solicitation of
an offer to buy such securities in any jurisdiction in which such
offer or solicitation is not qualified or to any person to whom
such offer or solicitation would be unlawful. Neither the delivery
of this Prospectus nor any sale made hereunder shall under any
circumstances create any implication that there has been no change
in the affairs of the Company since the date hereof or that the
information contained or incorporated by reference herein is
correct as of any date subsequent to the date hereof.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
Chiquita will furnish, without charge, to any person to whom
this Prospectus is delivered, upon such person's written or oral
request, a copy of any and all of the information that has been
incorporated by reference in the Registration Statement of which
this Prospectus is a part (not including exhibits to such
information unless such exhibits are specifically incorporated by
reference into such information). Any such request should be
directed to the Vice President, Corporate Affairs of Chiquita, 250
East Fifth Street, Cincinnati, Ohio 45202; telephone: (513)
784-6366.
The Annual Report on Form 10-K for the year ended December 31,
1994 (the "1994 10-K") filed by Chiquita with the Commission
(Commission file number 1-1550), and the description of Capital
Stock of Chiquita contained in a Registration Statement on Form 8-A
filed by Chiquita (then called United Brands Company) on September
11, 1970, are incorporated herein by reference and made a part
hereof.
All documents filed by Chiquita pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act subsequent to the date of
this Prospectus and prior to the termination of the offering made
hereunder shall be deemed to be incorporated by reference into this
Prospectus and to be a part hereof from the respective dates of
filing of such documents. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall
be deemed to be modified or superseded for purposes of this
Prospectus to the extent that a statement contained herein, or in
any other subsequently filed document that also is or is deemed to
be incorporated by reference herein, modifies or supersedes such
statement. Any such statement so modified or superseded shall not
be deemed, except as so modified or superseded, to constitute a
part of this Prospectus.
THE COMPANY
Chiquita Brands International, Inc. is a leading international
marketer, processor and producer of quality fresh and processed
food products. Chiquita produces and markets an extensive line of
fresh fruits and vegetables sold under the Chiquita and other brand
names. These products include tropical fruit, such as bananas,
mangos, kiwi and citrus, and a wide variety of other fresh produce.
The core of the Company's operations is the marketing, distribution
and sourcing of bananas.
The Company's operations also include:
(bullet) fruit and vegetable juices sold primarily in the United
States, and processed bananas, other processed fruits and
vegetables marketed worldwide, under the Chiquita and
other brand names;
(bullet) wet, fresh cut and ready-to-eat salads sold under various
brand names; and
(bullet) branded consumer packaged foods marketed in Latin
America.
The Company's Meat Division, previously reported as a
discontinued operation, has been reconsolidated for financial
reporting purposes. The Company is continuing to pursue the
disposition of the Meat Division operations which have not already
been sold. The Meat Division is engaged in the processing and
marketing primarily of fresh pork and processed meat products,
including sausage, frankfurters, bacon, hams and luncheon meats.
American Premier Group, Inc. ("APG") owns, through its
subsidiaries, approximately 46% of Chiquita's outstanding shares of
Common Stock and 31% of Chiquita's Mandatorily Exchangeable
Cumulative Preference Stock, Series C (the "Series C Preferred
Stock") represented by $1.32 Depositary Shares. APG is a holding
company which was formed to acquire and own all of the outstanding
common stock of American Financial Corporation and American Premier
Underwriters, Inc. in a transaction which was consummated in April
1995. Carl H. Lindner, Carl H. Lindner III, S. Craig Lindner and
Keith E. Lindner are the beneficial owners of 49.8% of APG's common
stock.
Chiquita is a New Jersey corporation. The address of its
principal executive offices is 250 East Fifth Street, Cincinnati,
Ohio 45202 and its telephone number is (513) 784-6366. Unless the
context indicates otherwise, the term "Chiquita" also includes the
subsidiaries of the Company.
INVESTMENT CONSIDERATIONS
In addition to the other information set forth in this
Prospectus, prospective investors should carefully consider the
following in the context of the more complete disclosure in the
Company's 1994 10-K before making an investment in the Shares.
Recent Losses
From 1984 to 1991, Chiquita reported a continuous record of
growth in annual earnings. However, in 1992, the Company reported
a net loss of $284 million, which included restructuring and
reorganization charges of $96 million. In 1993, the net loss was
reduced to $51 million as a result of benefits from the Company's
multi-year investment spending program and its restructuring and
cost reduction efforts. In 1994, Chiquita reported a net loss of
$72 million, which included extraordinary charges of $23 million
from prepayment of debt and charges and losses totaling $57 million
resulting primarily from farm closings and banana cultivation
write-downs in Honduras following an unusually severe strike and
the substantial reduction of the Company's Japanese "green" banana
trading operations. See the Company's Consolidated Financial
Statements and "Management's Analysis of Operations and Financial
Condition" in the Company's 1994 10-K.
Leverage
As of December 31, 1994, the Company had short-term notes and
loans payable of approximately $130 million and long-term debt
(including current maturities) of approximately $1.5 billion. As
of December 31, 1994, the Company had total long-term debt
maturities for 1995 of $91 million, and for the years 1996 through
1999 amounts ranging from $47 million to $118 million. The
percentage of total debt to total capitalization for the Company
was 71% at December 31, 1994.
Competition and Pricing
Sales of bananas were 38% of the Company's consolidated net
sales in 1994 (60% excluding revenues of the Meat Division held for
sale). Banana marketing is highly competitive; while smaller
companies, including growers' cooperatives, have become a
competitive factor, Chiquita's principal competitors continue to be
a limited number of large international companies. In order to
compete successfully, Chiquita must be able to source bananas of
uniformly high quality and distribute them in worldwide markets on
a timely basis. Bananas are highly perishable and must be brought
to market and sold generally within 60 days after harvest.
Therefore, selling prices which importers receive for bananas
depend on the available supplies of bananas and other fruit in each
market, the relative quality, and wholesaler and retailer
acceptance of bananas offered by competing importers. Excess
supplies may result in increased price competition. Competition in
the sale of bananas also comes from other fresh fruit, which may be
seasonal in nature; the resulting seasonal variations in demand
cause banana pricing to be seasonal, with the first six months of
the calendar year being the stronger period. Chiquita has been
able to obtain a premium price for its bananas due to its
reputation for quality and its innovative marketing techniques.
See the Company's 1994 10-K.
Adverse Weather Conditions and Crop Disease
Bananas are vulnerable to adverse local weather conditions,
which are quite common but difficult to predict, and to crop
disease, the control of which entails significant expense. These
factors may restrict worldwide supplies and result in increased
prices for bananas. However, competitors may be affected
differently depending upon their ability to obtain adequate
supplies from sources in other geographic areas. Chiquita has a
greater number and geographic diversity of sources of bananas than
any of its competitors. During 1994, approximately 35% of all
bananas sold by Chiquita were sourced from Panama. Bananas sourced
from other countries, including Colombia, Costa Rica, Guatemala and
Honduras, comprised from 4% to 19% (depending on the country) of
bananas sold by Chiquita during 1994. See the Company's 1994 10-K.
Labor Relations
The Company employs a total of approximately 45,000 persons,
including approximately 40,000 in its core Chiquita operations and
approximately 5,000 in the Meat Division. Approximately 36,000 of
the Chiquita operations associates are employed in Central and
South America, including 28,000 workers covered by labor contracts.
The Company has approximately 85 labor contracts with such
employees and 11 labor contracts with Meat Division employees, with
terms expiring from 1995 to 1999. Strikes or other labor-related
actions are often encountered upon expiration of labor contracts
and also frequently occur during the term of the contracts. During
the summer of 1994, the Company's workers in La Lima, Honduras
struck its operations there during the term of their contract
seeking higher wages. After a 35-day strike, the Company and the
workers' union reached an agreement on additional contractual cost
of living adjustments. The cost of living adjustments have not had
a significant impact on the Company's operations. Chiquita decided
not to reopen four low productivity farms which had been closed
during the strike and, at the Company's remaining Honduran farms,
chopped back cultivations weakened during the strike. Write-downs
associated with the Honduran farms and cultivations were
approximately $25 million. See the Company's 1994 10-K.
European Union Banana Regulation
On July 1, 1993, the EU implemented a new quota effectively
restricting the volume of Latin American bananas imported into the
EU, which had the effect of decreasing the Company's volume and
market share in Europe. The quota is administered through a
licensing system and grants preferred status to producers and
importers within the EU and its former colonies, while imposing new
quotas and tariffs on bananas imported from other sources,
including Latin America, Chiquita's primary source of fruit. In
two separate rulings, General Agreement on Tariffs and Trade
("GATT") panels found this banana policy to be illegal. In March
1994, four of the countries which had filed GATT actions against
the EU banana policy (Costa Rica, Colombia, Nicaragua and
Venezuela) reached a settlement with the EU by signing a "Framework
Agreement." The Framework Agreement authorizes the imposition of
additional restrictive and discriminatory quotas and export
licenses on U.S. banana marketing firms, while leaving EU firms
exempt. Costa Rica and Colombia are presently implementing this
agreement. Full implementation of the Framework Agreement could
significantly increase the Company's cost to export bananas from
these sources. Three additional European countries (Sweden,
Finland and Austria) joined the EU effective January 1, 1995.
These countries, which have had substantially unrestricted banana
markets in which Chiquita has supplied a significant portion of the
bananas, are in the process of transition to the restrictive EU
quota and licensing environment. The timing and exact nature of
any adjustments in the quota and licensing regulations that will be
made for these new EU members have not yet been determined.
In September 1994, Chiquita and the Hawaii Banana Industry
Association made a joint filing with the Office of the U.S. Trade
Representative under Section 301 of the U.S. Trade Act of 1974,
charging that the EU quota and licensing regime and the Framework
Agreement are unreasonable, discriminatory, and a burden and
restriction on U.S. commerce. In response to this petition, the
U.S. Government initiated a formal investigation of the EU banana
import policy in October 1994. In January 1995, the U.S.
Government announced a preliminary finding against the EU banana
import policy and launched separate investigations of the Colombian
and Costa Rican Framework Agreement policies. The EU, Colombian
and Costa Rican investigations are continuing. Section 301
authorizes retaliatory measures, such as tariffs or withdrawal of
trade concessions, against the offending countries. However, there
can be no assurance as to the results of the investigation, the
nature and extent of actions the U.S. Government might take, or the
impact on the EU quota regime or the Framework Agreement.
Other Risks of International Operations
The Company's operations are conducted in many areas of the
world, and are subject to risks that are inherent in operating in
foreign countries, including government regulation, currency
restrictions and other restraints, risks of expropriation,
burdensome taxes, quotas and tariffs. See Notes 1 and 9 to the
Company's Consolidated Financial Statements and "Management's
Analysis of Operations and Financial Condition" included in the
Company's 1994 10-K for information with respect to currency
exchange. There is also a risk that legal or regulatory
requirements will be changed or that administrative policies will
change. Certain of the Company's operations are dependent upon
leases and other agreements with the governments of the countries.
Although the Company's operations are a significant factor in the
economies of many of the countries where the Company produces and
purchases bananas and other agricultural and consumer products, the
Company's overall risk from these factors, as well as from
political changes, is reduced by the large number and geographic
diversity of its sources of bananas. The Company's operations
worldwide and the products it sells are subject to numerous
governmental regulations and inspections by environmental, food
safety and health authorities. Although the Company believes it is
substantially in compliance with such regulations, actions by
regulators have in the past required, and in the future may
require, operational modifications or capital improvements at
various locations or the payment of fines and penalties, or both.
See the Company's 1994 10-K.
Meat Division Held for Sale
The Meat Division had an operating loss of $57 million in
1992, and operating income of $6 million and $39 million in 1993
and 1994, respectively, on net sales of $1.7 billion, $1.5 billion
and $1.5 billion in the corresponding periods. Profit margins in
the fresh meat business are low and competition among packers in
the United States is strong. Price, quality and brand
identification are major competitive factors. The Meat Division's
major competitors in fresh and processed meats are large U.S. meat-
packing corporations, as well as a large number of U.S. regional
and local meat packers. Competition also comes from other high
protein products, including beef, poultry, seafood and dairy
products. The Company is continuing to pursue the sale of the
remainder of its Meat Division operations. See the Company's 1994
10-K.
Shares Available for Future Sale
No prediction can be made as to the effect, if any, that
future sales of shares of Common Stock, or the availability of such
shares for future sales, will have on the prevailing market price
of the Common Stock. Sales of substantial amounts of Common Stock,
or the perception that such sales could occur, could adversely
affect prevailing market prices for the Common Stock. At April 4,
1995, the Company had outstanding 50,236,490 shares of Common Stock
and 648,310 shares of Series C Preferred Stock, including,
respectively, 22,987,640 and 200,000 shares held indirectly by APG.
In addition to the Shares offered from time to time hereby, the
Company has an existing shelf Registration Statement on Form S-3
relating to approximately $80 million of securities (debt
securities, preferred stock or Common Stock) which could be issued.
USE OF PROCEEDS
The Company will not receive any proceeds from the sale of the
Shares by the Selling Shareholder. However, under certain
circumstances, the Company may repurchase some or all of the Shares
or the Selling Shareholder may be required to return some of the
Shares to the Company, in either of which cases, the Company
expects to retire them.
SELLING SHAREHOLDER
The Selling Shareholder is C.I. Promotora Bananera, S.A., a
Colombian corporation (the "Selling Shareholder"). The Selling
Shareholder is a producer of bananas which has in the past entered
into, and may in the future enter into, contractual agreements with
the Company and its subsidiaries relating to the production and
sale of bananas to such entities. The Selling Shareholder is not
an affiliate of the Company. As of April 4, 1995, the Selling
Shareholder owned 330,000 shares of Common Stock, including the
Shares. The Selling Shareholder is offering up to 330,000 Shares
pursuant to this Registration Statement and, assuming the sale of
all such Shares, will hold no shares following such sales.
PLAN OF DISTRIBUTION
The Shares may be sold from time to time by or for the account
of the Selling Shareholder directly to purchasers, to or through
broker-dealers or through a combination of these methods. Sales by
means of this Prospectus may be made privately at prices to be
individually negotiated with the purchasers or publicly through
transactions on the New York Stock Exchange, other exchanges or in
the over-the-counter market, at prices reasonably related to market
prices at the time of sale or at negotiated prices. Broker-dealers
participating in such transactions may act as agent or as principal
and may receive commissions from the purchasers as well as from the
Selling Shareholder. To the extent that Shares are sold in market
transactions, the Selling Shareholder has agreed to observe any
volume limitations deemed appropriate by the Company.
All expenses relating to the registration and sale of the
Shares other than fees and expenses of counsel, accountants or
other consultants to the Selling Shareholder will be paid, directly
or indirectly, by the Company.
The Company has agreed with the Selling Shareholder, subject
to certain exceptions, to keep the Registration Statement covering
the Shares effective until the earlier of (i) three months after
the date of this Prospectus or (ii) the date on which all Shares
have been sold by the Selling Shareholder pursuant to the
Registration Statement.
In addition, the Company and the Selling Shareholder will
indemnify each other for certain liabilities, including civil
liabilities under the Securities Act.
LEGAL MATTERS
The validity of the Shares offered hereby has been passed upon
by Charles R. Morgan. Mr. Morgan, Vice President, General Counsel
and Secretary of Chiquita, presently holds shares of Common Stock
in the Company's Savings and Investment (401(k)) Plan as well as
employee stock options to purchase additional shares of Common
Stock.
EXPERTS
The consolidated financial statements of Chiquita Brands
International, Inc. appearing (or incorporated by reference) in its
Annual Report (Form 10-K) for the year ended December 31, 1994,
have been audited by Ernst & Young LLP, independent auditors, as
set forth in their report thereon included (or incorporated by
reference) therein and incorporated herein by reference. Such
consolidated financial statements are incorporated herein by
reference in reliance upon such report given upon the authority of
such firm as experts in accounting and auditing.
