The transaction will create a fresh produce company worth about $4.6 billion in annual revenues and it is expected to generate operational pre-tax savings of at least $40 million by the end of 2016.
Chiquita shareholders will own about 50.7 percent of the combined company, ChiquitaFyffes, while Fyffes shareholders will have the remaining 49.3 percent, the companies said in a statement on Monday.
The New York-listed combined company will have tax savings from being domiciled in Ireland, similar to U.S. drugmaker Perrigo's acquisition of Elan last year.
Chiquita shareholders will get one share of the new company for each share held. Fyffes investors will get 0.1567 of a share in the new group for each existing share, which values it at a premium of 38 percent over its Friday's closing price.
Fyffes shares jumped 29 percent to 1.15 euros by 0710 GMT.
The deal could raise antitrust issues, given that more than 80 percent of the global banana market is controlled by four multinationals - Chiquita, Fyffes, Fresh Del Monte and Hawaii-founded Dole Food Company - according to the United Nations.