WINDWARD ISLANDS: WIBDECO-FYFFES DEAL MAKES HISTORY....
(Banana Trade News Bulletin n. 6 - 2.1996)After forty years of producing bananas to build the empire of Geest Industries Ltd, the tiny four-island grouping in the Eastern Caribbean known as the Windward Islands, took a leap forward in history in late December 1995.
The Windward Islands Banana Development and Exporting Company (WIBDECO), a joint undertaking between the governments of Dominica, St Lucia, Grenada and St Vincent and the Grenadines and the official Banana Growers Association of those islands, made the historical acquisition of the banana business of Geest plc in partnership with the Irish-based Fyffes Ltd.
The new joint venture (on a 50-50 basis) will assume responsibility for the marketing of Windward Island bananas. It is made up of two companies called Windward Isles Banana Company (UK) Ltd and Windward Isles Banana Company (Jersey) Ltd. Of the £147.5 million paid for the Geest banana empire, WIBDECO and Fyffes each contributed £20 million equity and £52 million was financed by a loan secured on the assets of the joint venture. The remaining 55 million is related to a lease obligation associated with two ships currently leased to Noboa in Ecuador.
All in all the business purchased includes the following:
- the UK Green and Yellow Banana Business which ripens and distributes 8 million cartons of ACP fruit annually and includes the nine Ripening Centres in the UK along with the associated equipment;
- the European Dollar Banana Business which markets 11 million cartons of bananas sourced from Costa Rica for Colombia and Ecuador;
- the Costa Rican farm which included 11 separate farms, consisting of 3,500 hectares (9,500 acres) representing an investment by Geest of US$75 million. This farm produces 6.6 million cartons annually and employs 2,200 people;
- the two island class ships, the Geest St Lucia and the Geest Dominica representing 640,000 cubic feet, each purchased for US$44 million in 1991-92 by Geest;
- the Geest Backhaul Shipping Business which now transport 85% of non-banana cargo from the UK and which utilises four chartered ships which call at our ports each week.
The purchase has generally been welcomed in the islands. However, there is concern about the place of the farmers in the new restructured industry and how best they can secure their interests.
The Windward Islands Farmers Association, an umbrella grouping of national farmers' organisations in the sub-region, is facilitating the development of a common platform for joint action by the region's farmers.
It is in this context that WINFA has undertaken to bring together members of the various Independent Banana Committees in the Windward Islands in a meeting to discuss critical issues affecting the industry. The two day meeting will be held in St Vincent of 24-25 February 1996 and will examine the WlBDECO-Fyffes joint venture; the restructuring of the Windward Islands Banana Industry; the international banana situation, and alternative marketing.