Dole Food Co. Inc., Westlake Village, Calif., registered with the U.S. Securities and Exchange Commission for a proposed initial public offering of shares of its common stock, the proceeds of which will be used to pay down the companyâs massive debt.
The offering is to be a combination of primary shares newly issued by Dole and secondary shares to be sold by the companyâs sole current stockholder, David Murdock, the companyâs chairman.
According to the form S-1 that Dole filed with the SEC, the company is hoping to raise up to $500 million with the offering. The company will list its common stock on the New York Stock Exchange under the symbol âDOLE.â
Dole, which was founded in 1851 , paid a registration fee of $27,900 for the proposal.
On the Form 10-Q that Dole filed with the SEC for the quarter ending June 20, the company reported notes payable and long-term debt of more than $1.5 billion. For the first half of 2009, the companyâs sales fell 11.1% to $3.3 billion and profits decreased 18.3%. Revenue in 2008 was $7.6 billion, with net income of $123 million. Revenue for the latest quarter was $1.7 billion, down from $2 billion the previous year in that same quarter, while profit plunged to $20 million from $180 million.
On Aug. 4, Dole reported in its second-quarter financial report that it had reduced its net debt by $145 million and had reduced its debt by $480 million the last five quarters. The company also announced plans to sell properties in Latin America for about $68 million. It said those proceeds would also be used to pay down debt.
If any proceeds of the stock sale are left over after paydown of debt, it will used for general corporate purposes, according to a news release from Dole. The company will not receive any proceeds from the sale of shares by Murdock.
Goldman, Sachs & Co., Bank of America, Deutsche Bank Securities and Wells Fargo Securities will underwrite the offering, according to the release.
Marty Ordman, vice president of marketing for Dole, said the company would not comment on anything pertaining to the initial public offering at this time.
In an unrelated development, Dole also announced it will be offering $325 million of senior secured notes due in 2016. The issuance of those new bonds will be a private offering to eligible purchasers, subject to market and other conditions, and the net proceeds will be used to redeem 7.25% senior notes that come due on June 15, 2010.