Chiquita Closes U.S. Plants

NEW YORK - Dec 6/05 - SNS -- Chiquita Brands International, Inc. will close processing facilities in Manteno, Ill., and Kansas City, Mo., by February 2006 as part of a supply chain optimization plan.

This consolidation effort is one component of Chiquita's previously announced integration plan, which aims to cut annual operating costs by about $20 million within three years after the acquisition of Fresh Express. The company expects this consolidation to deliver approximately $3 million in annualized cost savings, which will begin to be realized in the second quarter 2006.

As a result of the closure of the pre-acquisition Chiquita plant at Manteno, the company will incur a charge of approximately $7 million, of which an approximately $5 million noncash charge will be recorded in the fourth quarter 2005 and a $2 million charge, primarily for noncancelable lease obligations, will be recorded in the first quarter 2006.

The closure of the pre-acquisition Fresh Express plant at Kansas City will result in a $4 million adjustment to goodwill through purchase price accounting, which will be recorded in the fourth quarter 2005. Substantially all of this adjustment is noncash and relates to asset disposals.

The approximately 100 employees at the company's Kansas City and Manteno facilities will be eligible to apply for open positions at other Chiquita operations. Employees displaced by this consolidation will be eligible for severance and outplacement services based on level of position and length of service. At minimum, employees will receive pay for their normal work schedule for 60 days following this announcement.