“We have great faith in the banana business,” DeLorenzo said during the call. “It’s been a very good cash flow business for us. We have very strong assets in that business. So, with the right structure we are not concerned at all.”
DeLorenzo said that he believes Dole’s stock is currently undervalued, and that is one reason for considering separating the businesses.
“Packaged foods has high growth potential and really deserves higher valuation,” DeLorenzo said. “This is really more about unlocking value than any other strategic type of movement.”
If the company does split fresh commodities from packaged food operations, Dole officials are not yet sure which entity would retain about 14,000 acres of land that it has for sale in Hawaii. The land is not in production and is valued at about $400 million, DeLorenzo said.