WESTLAKE VILLAGE, Calif.--(BUSINESS WIRE)--Sep. 17, 2012--
Dole Food Company, Inc. (NYSE: DOLE) 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.
David H. Murdock, Chairman of Dole Food Company, Inc. signs the definitive sales agreement of Dole's worldwide packaged foods and Dole Asia fresh businesses with Masahiro Okafuji, President & Chief Executive Officer of ITOCHU Corporation. (Photo: Business Wire)
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 (EBITDA) 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.
In connection with the transaction, Dole will recapitalize its debt
structure, with any new debt expected to be issued on more favorable
terms, reflecting the improved leverage profile of the company. Also in
connection with the transaction, Dole expects to adopt cost-saving
initiatives and corporate restructuring in order to right-size the
company. Dole will realign and streamline its global personnel and
corporate structure to conform to the specific needs of the remaining
fresh produce businesses. As part of this process, Dole will evaluate
the clearing of any legacy costs and liabilities remaining with the
company. Dole expects to fully implement these measures by the end of
fiscal 2013, which are expected to result in aggregate cost savings of
approximately $50 million annually.
"The consummation of this transaction will result in a more focused Dole
that retains significant scale with more than $4 billion in revenue and
a rich asset base,” said David H. Murdock, Dole’s chairman. “With a
substantial reduction in debt and the expected cost savings, Dole will
also be well positioned to take advantage of growth opportunities within
the fresh produce category.”
Conference Call
The company will host a conference call for investors to discuss this
transaction at 4:30 p.m. ET tomorrow, September 18, 2012. Access to a
live audio webcast is available at http://investors.dole.com
under “Webcasts.” Toll-free telephone access will be available by
dialing 1-866-700-6293 in the United States and 617-213-8835 from
international locations. The participant passcode is 33756630. A replay
of the call will be available until October 2, 2012. To access the
telephone replay, dial 1-888-286-8010 from the United States and
617-801-6888 from international locations and enter the confirmation
code 47638060. A replay of the webcast will be archived and available on www.dole.com.
Additional Information
The transaction is expected to be completed in the fourth quarter of
fiscal 2012, subject to the timing of the proxy statement process and
the anticipated regulatory approvals. The company intends to disclose
further information pertaining to this transaction and its strategic
business review process, as required or appropriate, in the future.
Deutsche Bank Securities Inc. is acting as lead financial advisor to
Dole, and Wells Fargo Securities, LLC. is also advising Dole on this
transaction. Both firms have been advising Dole on its strategic
business review.
Portions of this document may constitute “forward-looking statements” as
defined by federal law. Although the company believes any such
statements are based on reasonable assumptions, there is no assurance
that actual outcomes will not be materially different. Any such
statements are made in reliance on the “safe harbor” protections
provided under the Private Securities Reform Act of 1995. Additional
information about issues that could lead to material changes in
performance is contained in the company’s reports filed with the
Securities and Exchange Commission.
ABOUT DOLE FOOD COMPANY
DOLE is the world’s largest producer and marketer of high-quality fresh
fruit and fresh vegetables, and is the leading producer of organic
bananas and producer/shipper of organic pineapples. DOLE markets a
growing line of packaged and frozen fruit and is a produce industry
leader in nutrition education and research. For more information, please
visit www.dole.com.
For more information on DOLE’s sustainability initiatives, please visit www.dolesustainability.com.
Photos/Multimedia Gallery Available: http://www.businesswire.com/cgi-bin/mmg.cgi?eid=50411419&lang=en
Source: Dole Food Company, Inc.
Dole Food Company, Inc.
Joseph Tesoriero, 818-879-6900
or
Beth
Potillo, 818-879-6733
