UPDATE: July 22, 2021: Dole is eyeing a $2.1 billion valuation, as the company priced its shares and started its pre-IPO roadshow this week. Its IPO price will be between $20 and $23 per share, the company said in a statement. The company plans to sell 26,000,000 shares — 23,539,067 shares offered by Dole, and 2,460,933 ordinary shares to be sold by affiliates of Castle & Cooke, a real estate company that had been spun off of Dole in 1995 and is owned by former company owner David Murdock.
- Dole Foods filed paperwork for an initial public offering overnight on Thursday. The produce giant said in February it would file for an IPO in the U.S. as a condition of its planned merger with Ireland-based Total Produce. According to the F-1 filing, the merger is planned to be completed later this month.
- The F-1 doesn't indicate the company's prospective valuation, the number of shares that will be offered, or the potential price. The merger makes Dole the world's largest produce company, as well as the best-known brand in the industry, according to an Ipsos survey cited by the company. The combined company's sales were worth $8.97 billion last year.
- Dole has been angling to get back on the public market after its former CEO David Murdock took the company private in 2013. The company filed for an IPO in 2017, but withdrew it in 2018 after acquisition talks with a Belgian firm ended unsuccessfully.
With the Total Produce merger in the final stages and changed consumer attitudes toward produce, Dole appears to be on solid enough footing to get back onto the public markets.
The combined company is a powerhouse, with gross profits of more than $696 million last year, according to the F-1. The company projects a compound annual growth rate of 2.7% in its two primary markets of the U.S. and Europe between 2020 and 2025 as more consumers reach for fresh and organic produce. Dole is one of the world's largest producers of bananas, which make up 27% of the combined company's total products. Other fruit including pineapples comprise 45% of its product mix, while fresh vegetables — including salad mixes — make up the remaining 28%.
In a complex industry in which product freshness and careful handling are key, the combined company's sheer size and ownership of much of its supply chain adds to its capabilities. According to the F-1 filing, Dole offers more than 300 products from more than 30 countries, which are sold in 80 countries worldwide. It owns more than 109,000 acres of farm land, with its own well sourced supply chain — 16 refrigerated shipping vessels, 12 cold storage facilities, 75 packing houses and 162 distribution and manufacturing facilities. The company has about 40,000 employees across 29 countries.
While the newly combined Dole is massive, the company sees significant areas for growth, which it outlines in the file. The company plans to grow its berry and avocado businesses, currently worth about $700 million in pro forma sales, both through new varieties and utilizing scale to shorten the path from grower to market. Increasing organic offerings and value-added salads are also growth opportunities. There are plans to expand Dole-branded produce in Europe, and to further optimize the supply chain.
Aside from Dole's business, the world has changed since Dole last filed for an IPO. Healthy eating — especially diets that can be described with the buzzy moniker "plant-based" — is a top trend. According to the International Food Information Council, one in three consumers said they ate healthier in 2020. And while the coronavirus pandemic likely had a lot to do with that, renewed interest in produce is here to stay. While both fresh and frozen produce sales set records last year, 2021 sales so far are still far above those in pre-pandemic 2019, according to Blue Book Services. In March 2021, fresh produce sales at retail were 11% higher than March 2019.
A lot has changed for Dole as well. When the company made its unsuccessful IPO filing in 2017, it was a year after a listeria outbreak tied to its bagged salads severely sickened 18 people in the U.S. and 11 people in Canada, resulting in four deaths. The company settled two civil lawsuits tied to this outbreak in May 2017, weeks after the IPO filing. While Dole has recalled produce and salad kits since then, the events have been much less dire, and the brand name has had time to recuperate.
If Dole successfully returns to the stock market this year, it will find itself in the company of several new competitors. Large indoor farming companies have successfully grabbed investor capital and established themselves on the publicly traded market. AppHarvest went public in February with a $1 billion valuation through a merger with a special purpose acquisition company (SPAC), and AeroFarms will begin trading soon when its SPAC deal, valuing it at $1.2 billion, is completed.