Stockholders of Westlake Village, Calif.-based Dole Food Co. Inc. on Dec. 6 approved sale of the company’s worldwide packaged foods and Asian fresh businesses to Itochu Corp. for $1.685 billion.
With the pending sale also come personnel changes, including president and chief executive officer David DeLorenzo, who will leave Dole’s board and join Tokyo-based Itochu to head the newly acquired businesses, according to a news release.
David Murdock, Dole’s current chairman, will rejoin the board and also take on the duties of chief executive officer.
Six of seven reviewing countries have already approved the transaction, and both companies are working to close the sale by Dec. 31, pending regulatory approval from China.
After the sale, Dole will focus on two lines of fresh produce: fresh fruit and fresh vegetables.
Proceeds from the deal will be used to pay off existing Dole debt, helping to reduce interest expense, according to the release.
The deal is expected to result in overall Dole revenue decreasing by about 30% to $4.2 billion annually, according to the release. But it also should reduce the firm’s costs.
“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,” C. Michael Carter, Dole executive vice president and general counsel, said in the release.
Carter will be Dole president and chief operating officer and will rejoin the board as well.
Joseph Tesoriero, current executive vice president and chief financial officer, will leave Dole.
Keith Mitchell, current chief financial officer of Dole’s North American Fresh Fruit business, will become chief financial officer.
Itochu, with offices in 67 countries, conducts domestic trading, import-export and overseas trading of several products, including food, logistics services, textiles and chemicals, according to its website.