Dole Food Co. (DOLE:US) agreed to a higher takeover offer from Chairman and Chief Executive Officer David Murdock in a deal that values the fresh fruit and vegetable producer and marketer at $1.21 billion.
Murdock raised his offer to $13.50 a share in cash, the Westlake Village, California based company said in a statement today. That’s a 13 percent boost from the $12 a share Murdock, 90, offered in June for the 60 percent of the company not already owned by him or his family.
Murdock, who served as CEO between 1985 and 2007, returned to the role in February. He took the company private once before, in 2003, and has said he wants to do so again to remove “the concern that a public company must have for the investing public’s short-term expectations.”
Dole has been unprofitable in two of the last three years and according to one analyst’s estimate it’s forecast to lose $11.3 million in 2013. Sales declined in 2012 after the company divested European businesses and as banana prices fell in North America.
The transaction will be paid for with cash and equity contributed by Murdock as well as financing from Deutsche Bank AG (DBK), Bank of America Corp. (BAC:US) and the Bank of Nova Scotia. (BNS) The deal, expected to close during the fourth quarter, includes a 30-day “go-shop” period during which the board may consider alternate proposals.
Dole will pay a $15 million breakup fee if it accepts an alternative takeover. Murdock will pay $50 million if he fails to complete the transaction under certain circumstances.
Shareholders sued the company in June, alleging the board was violating its legal duty to get the best price by accepting Murdock’s bid.
Dole rose 5.3 percent to $13.49 at the close in New York the biggest rise in two months and its highest price since Oct. 4. The shares have gained 32 percent since Murdock’s initial offer was announced this year.
The company was founded 162 years ago and operates in more than 90 countries, producing bananas, pineapples and lettuce in Latin America and southeast Asia, according to its website.
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