Chiquita Brands, less than two years after being bribed by Charlotte’s and North Carolina’s political class to move headquarters to Charlotte, is on the verge of merging with an Irish company. The deal will call into question Chiquita’s presence in Charlotte as well as the status of Chiquita’s incentive payments. As reported in the N&O:
Less than two years after Chiquita moved its headquarters to Charlotte, the company said Monday it will merge with Irish fruit company Fyffes, throwing its $22 million worth of incentives into question.
If approved, the deal will strip Charlotte of a prominent corporate headquarters that leaders worked hard to lure away from Cincinnati with the promise of state and local money.
City and county officials said one of the requirements was keeping Chiquita Brands International’s headquarters in Charlotte for 10 years.
After the merger, senior executives will be split between Charlotte and Dublin. But the company, known as ChiquitaFyffes, will be based in Ireland, which has a substantially lower corporate tax rate. (emphasis added)
Ireland’s corporate tax rate is 12.5% while America’s is 40% – plus the NC state corporate tax rate of 6.9% (which will drop to 5% by 2015 thanks to last year’s tax reform).
Government officials are conflicted as to whether the merger and HQ move will disqualify Chiquita from receiving further incentive money, and whether previous handouts need to be paid back.