Westlake Village, CA-
By Jordan Okumura
12.10.12
Dole Food Company, Inc. stockholders have approved the sale of its worldwide packaged foods and Asia fresh businesses to ITOCHU Corporation for $1.685 billion. The company announced the step forward last week when the stockholders approved the sale at a special meeting of stockholders held at the Dole headquarters in Westlake Village, California. Dole has also announced planned leadership changes along with the recent news.
The transaction has received approval in six of the seven reviewing countries. Both companies hope to close the deal by December 31, 2012. The sale is subject to final regulatory approval from China.
The sale will reduce Dole's footprint with a significant portion of Dole’s operations being sold to ITOCHU. The new Dole footprint will span two lines of fresh produce businesses: fresh fruit and fresh vegetables. With the worldwide packaged foods and Asia fresh businesses gone, Dole's overall revenue for the company will drop to the approximately the $4.2 billion range with revenue from its fresh fruit business line being reduced in size by approximately 30%.
David H. Murdock, Dole’s Chairman, stated in a press release, “While Dole’s fresh produce business will be significantly smaller and is continuing to experience declining earnings in a continued difficult economic environment both in the United States and in Europe, I am very optimistic about the long-term future of Dole and its prospects. We will remain an industry leader in the sourcing, distribution and marketing of bananas, pineapples and other tropical fruits, packaged salads, fresh-packed vegetables and fresh berries. With the planned substantial reduction in debt and the eventual lower cost structure from right-sizing our organization, Dole will be well positioned to pursue growth opportunities within the fresh produce industry.”
The planned leadership changes include David A. DeLorenzo, current President and Chief Executive Officer, leaving Dole's board to join ITOCHU to lead the newly acquired Asia fresh and worldwide packaged foods businesses. David H. Murdock return to the role of Chairman and Chief Executive Officer, with C. Michael Carter taking on the added role of President and Chief Operating Officer. Mr. Carter will also rejoin Dole’s board.
Keith C. Mitchell, current Chief Financial Officer of Dole’s North American Fresh Fruit business, will become Chief Financial Officer. A. Charlene Mims will head Human Resources. Beth Potillo, current Treasurer, and Yoon J. Hugh, current Controller and Chief Accounting Officer, will take on new roles as Senior Vice Presidents with added responsibilities.
Mr. Carter, stated, “Our resulting business profile will have lower fixed costs and hence more operating flexibility, with more clarity and focus, allowing us to dedicate our resources more fully to operating and growing our remaining fresh fruit and vegetable businesses. Our new capital structure will also provide us with increased flexibility, and will allow us to react quickly to any acquisition opportunities in the commodity produce sector, which we expect would be funded by anticipated new borrowings and future internally generated free cash flow.”
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Dole
Founded in Hawaii in 1851, Dole Food Company, Inc., with 2010 revenues of 6.9B, is the world's largest producer and…
