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July 20, 2012

US: Dole mulls packaged food disposal

Dole Food Co. has admitted it is considering selling its global packaged foods business and could complete the move by the end of the year.

By Dean Best

Dole Food Co. has admitted it is considering selling its global packaged foods business and could complete the move by the end of the year.

The US food group yesterday (19 July) shone more light on the “strategic review” of its operations, which it announced in May, and put forward the sale of the unit as one option on the table.

Dole said its worldwide packaged foods unit could be spun off to current shareholders. A third scenario could see Dole combine the unit with its broader business in Asia through a listing in the region or through a venture with a third party.

“The company is currently evaluating prospective transactions and options for a number of the company’s businesses and has been in discussions with numerous third parties who have expressed interest in select businesses,” Dole said.

“All of these alternatives are intended to enhance shareholder value. The company believes it is on track to achieve one or more of these possible transactions, or any other transaction in connection with the strategic review, by the end of the year. However, there can be no assurances that the company will pursue or complete any of the strategic alternatives that are currently being reviewed or any other transaction.”

Dole’s update came as it reported its half-year financial results. Lower earnings from its banana operations hit Dole’s first-half profits.

The company said comparable income from continuing operations was US$83.8m for the six months to 16 June, down from $135.1m a year earlier. EBIT before discontinued operations was $152.1m, against $173.5m the previous year.

Revenues were $3.35bn. A year earlier, Dole booked revenue of $3.6bn.

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