Dole's 94-Year-Old Owner to Take Fruit Producer Public AgainBy
Chairman and biggest shareholder David Murdock steering deal
Murdock took the food producer private twice in a decade
David H. Murdock, the 94-year-old owner of Dole Food Co., is taking the fruit and vegetable producer through its third initial public offering.
It’s the latest step in a long, colorful history involving Murdock and Dole. He took the 166-year-old company private for the first time in 2003, after rescuing the food producer from bankruptcy more than two years earlier. Murdock oversaw the re-listing of Dole in a 2009 IPO.
Four years later, Murdock took Dole private again while he was chairman, chief executive officer and the biggest shareholder. Many shareholders thought the buyout price of $13.50 a share was too low, and they sued. They won an additional $2.74 a share, plus interest, in a suit that was further complicated by a faulty share count.
Now, chairman and 100 percent owner Murdock is back at it again. Westlake Village, California-based Dole filed for an initial offering of $100 million, according to the filing Tuesday with the U.S. Securities and Exchange Commission. That’s a placeholder amount used to calculate fees that will change. Morgan Stanley, Bank of America Corp. and Deutsche Bank AG are leading the offering.
Dole, founded in 1851, had a net loss of $23 million in fiscal 2016, on revenue of about $4.5 billion. It’s the No. 1 producer of bananas in North America by market share, and the No. 2 producer of pineapples in that market, according to the prospectus.
Part of its success can be attributed to moves Murdock has made since taking the company private in 2013, according to the prospectus. Dole has expanded through farm acquisitions and the purchase of three vessels for its West Coast operations. Meanwhile, costs have been cut by divesting non-core assets.
That latest take-private caused a legal stir between Murdock and investors that ended up resolving in the latter’s favor. The Dole owner this year agreed to pay a $74 million settlement of claims he misled shareholders about the 2013 buyout so he could inexpensively acquire the remainder of the company.
That followed the 2015 ruling by a Delaware judge for Murdock and Dole’s ex-president and chief counsel Michael Carter to pay an additional $148 million to shortchanged investors in the 2013 buyout of the 40 percent of the company Murdock didn’t already own. With interest, that award totals $170 million. Murdock received an “improper personal benefit” from the deal, Delaware Chancery Court Judge Travis Laster ruled.
In total, the settlement and the Delaware order brought the total amount of payouts to $244 million. Murdock is currently fighting insurers’ lawsuits over the judgments against him related to the 2013 buyout.
(An earlier version of this story corrected the spelling of Deutsche Bank.)
— With assistance by Jef Feeley