Shares in Fyffes's property spin-off, Blackrock International Land, will begin trading in Dublin and London next Monday. The fruit importer's shareholders voted overwhelmingly in favour of the spin-off of its property interests to the new company at a meeting in Dublin yesterday.
Fyffes's chairman Carl McCann told the meeting that once the transfer was complete, Blackrock equities would begin trading on Dublin's IEX exchange and London's Alternative Investment Market (AIM) on May 15th.
The company's shareholders, who will get a stake worth €124 million in Blackrock, will receive their share certificates after May 17th.
Fyffes's shareholders were asked to vote on three resolutions that would make the transfer of property to Blackrock and the demerger possible.
Under the demerger agreement's terms, Fyffes will buy a 40 per cent stake in Blackrock for €83 million. Individual Fyffes shareholders will ultimately receive one Blackrock share for every share they hold in the fruit importer.
This will be managed through the issuing of tracker shares to Fyffes's shareholders. They can exchange these for Blackrock shares. The trackers will be cancelled once that transaction is completed.
Fyffes's shareholders will hold the remaining 60 per cent of the company once the deal goes through. Mr McCann told the meeting yesterday that shareholders would not end up with any tax liabilities in Ireland or Britain. Fyffes will transfer €197 million in gross assets and €63 million in debt, owed to the fruit importer, to the new company.
After the €83 million that it will receive for Fyffes's 40 per cent stake, this will leave Blackrock with €20 million net cash.
Mr McCann told yesterday's meeting that the impact on Fyffes's profits would be minimal. "It's actually very small, around 0.8 cent a share, and this arises mainly from the rent payable to Blackrock," he said.
The properties that Blackrock will receive through the deal will include Fyffes's headquarters and depot in Dublin city centre, as well as properties in Clonshaugh and Swords. It will also get industrial premises in Belfast, Dundalk - including the old Xerox complex - Galway, Navan and Tralee.
In England and Scotland, it will acquire properties in Bristol, Edinburgh, Livingston, Wakefield and other centres.
A number of shareholders said at the meeting that they were concerned that Fyffes was over-represented on the new company's board, which implied that it was not fully independent. However, Mr McCann pointed out that the company's directors were in a minority on the Blackrock board.
He indicated that Fyffes's involvement with Blackrock would be reduced over time.
Some shareholders also criticised the fact that some properties, including part of the old Xerox complex in Dundalk, were vacant. Mr McCann said a portion of that building consisted of clean-room facilities, which cost "tens of millions" to develop. He said the company was waiting to see if it could get a tenant for these facilities, as this would boost rent for the building.
