Calavo exploring sale of Fresh Cut Business for $100 million

Calavo Growers is exploring the sale of its Fresh Cut Business to focus on its core avocado and guacamole offerings.

The potential sale, to F&S Fresh Foods, has a total transaction value of approximately $100 million, according to a news release.

“Since I returned to Calavo as CEO in March, we have renewed our focus on our core avocado and guacamole businesses to maximize profitability, and I am pleased with the progress we have made,” Lee E. Cole, Calavo president and CEO, said in the Jan. 16 release. “To dedicate more focus to our core and to maximize shareholder value, we have been exploring strategic alternatives for our Fresh Cut Business, previously known as RFG.

“I am pleased to share that we have signed a non-binding letter of intent to evaluate a sale of our Fresh Cut business and some related real estate with F&S Fresh Foods, a leader in the industry and one of our long-trusted co-packing partners.”

Closing is anticipated in the second fiscal quarter of 2024, according to the release. Terms are still being negotiated.

Calavo also announced a quarterly cash dividend on its common stock of 10 cents per share to be paid Jan. 31 to shareholders of record as of Jan. 26.

Founded in 1924 and headquartered in Santa Paula, California, Calavo sells fresh-cut fruit, vegetables and prepared foods.

The company has processing plants and packing facilities throughout the U.S. and Mexico.

F&S Fresh Foods, headquartered in Vineland, New Jersey, distributes fresh-cut fruits and vegetables to nearly 100 million customers daily, according to its website, and processes more than 100 million pounds of produce annually for retail, food service and industrial customers.