Belgium's Greenyard explores acquisition of Dole Food -sources
18/12/2017 17:09
By Greg Roumeliotis and Harry Brumpton
Dec 18 (Reuters) - Belgian frozen foods company Greenyard NV
GREENY.BR is exploring an acquisition of Dole Food Co, a U.S.
fruit and vegetable producer that could be valued at more than
$2.5 billion, including debt, people familiar with the matter
said on Monday.
California-based Dole has also been considering a potential
initial public offering, but a deal with Greenyard could provide
a quicker avenue for Dole's 94-year-old CEO David Murdock to
cash out on his ownership of Dole.
Murdock views Greenyard's offer as better than that of
private equity firms that took an interest in Dole, according to
the sources, who asked not to be identified because the talks
are confidential. However, there is no certainty that Greenyard,
which has a market capitalization of close to 900 million euros
($1.06 billion), will secure the necessary financing for a deal,
or that it will agree to terms with Dole, the sources added.
If the two companies fail to clinch a deal, Dole will
continue to assess other offers as it proceeds with plans for an
IPO, one of the sources added.
Greenyard and Dole did not immediately respond to requests
for comment.
Dole, once the world's largest producer of fruits and
vegetables, was taken private by Murdock in 2013 in a $1.2
billion deal following a four-year run as a publicly listed
company. That deal came as Dole struggled to generate profits
amid volatile demand and low prices for bananas, its
highest-selling product.
Before going private, Dole had sold its packaged foods and
Asia fresh produce businesses to Japan's Itochu Corp 8001.T
for $1.7 billion, shrinking itself by a third, to help pay down
debt.
Since Dole's sale to Murdock, the fruit producer has cut
costs, sold non-core assets, improved its supply chain and
diversified its product lines, the company said in its IPO
paperwork with the U.S. Securities and Exchange Commission.
Dole, one of the largest producers of bananas and
pineapples, has also said it expects to benefit from the
increasing demand for fresh produce from health-conscious
consumers.
The company generated $4.51 billion in revenue last year,
but posted a net loss of $23.7 million. That compared with a
loss of $144.5 million and revenue of $4.25 billion in 2012, the
year before Dole went private.
Murdock last year reached a settlement related to a lawsuit
that alleged that he short-changed shareholders in 2013 when he
took Dole private.
Half of Greenyard is owned by Belgian entrepreneur Hein
Deprez and his family company, according to Thomson Reuters
data.
(Reporting by Greg Roumeliotis and Harry Brumpton in New York;
Editing by Will Dunham)
((Greg.Roumeliotis@thomsonreuters.com; +1 646 223 6022; Reuters
Messaging: greg.roumeliotis.thomsonreuters.com@reuters.net))
Keywords: DOLEFOOD M&A/GREENYARD