Dole to Sell Worldwide Packaged Foods, Asia Fresh Produce

By CnAgri2012-09-19 19:35:52 Print

Dole Food Company, Inc. announced that it has signed a definitive agreement with ITOCHU Corporation for the sale of Dole's worldwide packaged foods and Asia fresh produce businesses for $1.685 billion in cash. This proposed transaction results from Dole's previously announced strategic business review process, and is subject to Dole stockholder approval and customary regulatory approvals in multiple countries. Cash proceeds from the transaction will be used by Dole for debt reduction, to pay deal-related expenses, and for restructuring and other corporate purposes.

Dole Worldwide Packaged Foods produces canned pineapple, canned pineapple juice, fruit juice concentrate, fruit in plastic cups, jars and pouches, fruit parfaits, healthy snack foods and frozen fruit. Dole Asia Fresh Produce grows, sources, ships and distributes consistently high-quality fresh fruit and vegetables principally in Asia. The combined revenue of these businesses totaled approximately $2.5 billion in 2011. The adjusted Earnings Before Interest, Taxes, Depreciation and Amortization for these businesses in 2011 was approximately $190 million (excluding allocation of corporate overhead). The agreement contemplates that ITOCHU will have exclusive rights to the DOLE?trademark on packaged food products worldwide and on fresh produce in Asia, Australia and New Zealand.

"When we announced our strategic business review in May, we stated that we would review a broad range of strategic alternatives for our businesses with the goal of enhancing shareholder value," said David A. DeLorenzo, Dole's president and CEO. "We believe this proposed transaction accomplishes that. We are realizing a premium valuation for our worldwide packaged foods and Asia fresh produce businesses and will retain a strong fresh produce business that has increased financial flexibility to grow."

Dole Food Company, Inc. will remain an international company, retaining its entire North American fresh vegetables business as well as its fresh fruit businesses in North America, Latin America, Europe and Africa, which together generated approximately $4.2 billion in revenues in fiscal 2011. Following completion of the transaction, Dole's fresh produce business will continue to be an industry leader in the sourcing, distribution and marketing of bananas, pineapples and other tropical fruits, packaged salads, fresh-packed vegetables and fresh berries, representing the number one or two market share in many of the fresh fruit and vegetable products it sells in North America. Dole will continue to own the significant operating assets associated with these businesses, as well as non-core assets, including approximately 25,000 acres located in Oahu, Hawaii.