A Chapter 11 bankruptcy filed by Chiquita Brands International Inc. on Wednesday is the “best alternative available to restoring the company to financial vitality,” the company's lawyer said.

        A committee of almost one-third of the bondholders already has signed off on Chiquita's reorganization plan, which gives the bondholders more than 90 percent of the new stock. Chiquita hopes to emerge from bankruptcy by March 31.

Lindner

        Chiquita stopped making payments on more than $800 million in debt in January and persuaded bondholders to exchange their notes for company stock.

        The real question is what kind of Chiquita will emerge next spring.

        Depressed European currencies and banana prices worldwide have hurt the company for years, and those problems are still around. The company's stock has fallen to historic lows, closing at 48 cents per share Wednesday.

        But Chiquita officials hope that $60 million less in annual interest costs and the end of an eight-year trade war between the United States and Europe will again make it one of the most valued brand names in the world.

        “The brand name is as strong or stronger than it has been in 20 years,” CEO Steve Warshaw said.

        In filings earlier this fall, Chiquita projected large increases in sales and cash flow for several years. Without the parent company debt, its new shareholders should enjoy the benefits, it said.

        Another change will be the reduced stake of chairman Carl Lindner. That stake, held by Mr. Lindner's umbrella company, American Financial Group Inc., will drop to about 7 percent of the new shares after warrants for common stock are exercised.

        Mr. Lindner and Mr. Warshaw will remain on the board of directors, joined by five bondholder nominees. Mr. Warshaw will remain CEO; it is uncertain whether Mr. Lindner will stay chairman.

        In creditor lists filed Wednesday, familiar Wall Street investment houses such as Goldman Sachs & Co., Bear Stearns Securities Corp. and Chase Manhattan Bank represent the biggest bondholders.

        Chiquita wants to act quickly to send a signal to its employees, vendors and operating units that it will not slow down its everyday business. The bankruptcy is only for the parent company, not its many operating companies.

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