By Katia Marintez
The Associated Press

PANAMA CITY, Panama - Chiquita Brands International Inc. on Monday will transfer one of its cash-strapped divisions to a worker-owned cooperative in northern Panama - one of the largest such hand-overs in the banana-growing industry's history.

In April, the Puerto Armuelles Fruit Co.'s union agreed to pay $20 million to buy the company its members work for and the 7,415 acres of plantations it controls in Chiriqui province, 310 miles north of the capital of Panama City, on the border with Costa Rica.

The ownership transfer takes place Monday in Chiriqui.

The ownership transfer guarantees that the Cincinnati-based fruit giant will buy bananas from its former division for at least 10 years.

Puerto Armuelles' 3,200 workers produced about 6 percent of Chiquita's Latin American banana supply, but the company cut off subsidies to the division in January, announcing that it had lost $90 million in six years because of Puerto Armuelles.

"It's a historic event ... it's a lot of responsibility for us," a union director, Edgard Williams, said in an interview Sunday. "Our goal is to make this division productive and profitable."

Bolivar Pariente, general manager of Panama's National Bank said the government considers the sale "mutually beneficial."

Puerto Armuelles makes up nearly a third of Chiquita's Panamanian operations and the company continues to control all of its other subsidiaries in this country.

Chiquita pioneered the banana trade in Panama a century ago and still accounts for 89 percent of the country's banana exports. It first established operations in the town of Puerto Armuelles in 1927 and founded a company of the same name there less than a year later.

Panama exported $109.4 million worth of bananas last year, down 10 percent from 2001.