Fyffes PLC and Chiquita Brands International, major Fruit distributors in the US, have said that they have entered into an agreement to merge with each other.

The two companies will merge in an all-stock transaction valued at about $1.07 billion. ChiquitaFyffes will be a larger and more diversified organization following the merger. It will become the largest global entity in the banana category with sales of more than 160 million boxes annually.

The shareholders of Chiquita would own 50.7 per cent of the new company. Dublin-based Fyffes said that the new firm, ChiquitaFyffes would have $4.6 billion in annual revenue and 32,000 employees around the world.

Ed Lonergan, Chief Executive of Chiquita, based in Charlotte said, "We will maintain our brands, all of which are valued by both customers and consumers. The combined company will also be able to provide customers with a more diverse product mix and choice".

David McCann, Fyffes's executive chairman will become the chief executive of the new company and Mr. Lonergan will serve as chairman. The transaction will create a fresh produce company worth about $4.6 billion in annual revenues.