Shares in fruit distributor Fyffes rose sharply in yesterday's half-day trading session on the Irish stock market, and there was speculation that the McCann family may have been once again buyers of the shares.
Fyffes shares dealt up 13 cents to €1.00 (£1.27), their highest level since mid-October and well above the €0.68 low of late November. The price is a long way off the €3.98 high of last February after Fyffes shares soared on the back of hopes that its worldofruit.com Internet venture would transform Fyffes' fortunes. Turnover yesterday was just short of 2.2 million or 0.7 per cent of the total equity.
Since Fyffes reached those heights in the early part of the year - when long-standing shareholder DCC sold its entire 11 per cent stake at a huge profit - the shares have gone into free-fall beginning with a profits warning at the group's annual general meeting in March.
After half-year profits tumbled 40 per cent to €19.5 million, Fyffes put in place a restructuring and rationalisation programme involving the closure of two ripening centres in the UK with the loss of 200 jobs. But those measures have failed to reassure the market and the shares have struggled to move beyond €1.00 and have spent most of the past two months trading below that figure.
In the period before Christmas, Balkan Investments - the company controlled by Fyffes chairman Mr Neil McCann, chief executive Mr David McCann and finance director Mr Carl McCann - bought 795,000 shares at prices of €0.80 and €0.85. This has led to speculation that the McCann family, who floated the company on the stock market 12 years ago, might be planning to take Fyffes private once again.
Institutional investors have become disillusioned with the stock - especially after many overseas institutions bought large volumes of Fyffes shares from DCC earlier this year for up to €3.90 a share. The company is also suffering from the general market disinterest with small and mid-capitalisation shares. At yesterday's price of €1.00, Fyffes is worth just under €294 million.
