Leading avocado provider to acquire California produce company
Fresh avocado producer and distributor Mission Produce will acquire Calavo Growers, a California-based provider and distributor of avocados, tomatoes, papayas and guacamole.
Under the terms of the agreement, Calavo stockholders will receive $27 per share, comprised of $14.85 in cash and 0.9790 shares of Mission for each share of Calavo. The transaction values Calavo at a total enterprise value of approximately $430 million.
“This acquisition marks an important milestone for Mission and for our industry,” Steve Barnard, Mission co-founder and CEO, said in a news release. “By bolstering Mission’s vertically integrated platform and trusted global distribution network with Calavo’s complementary sourcing, prepared foods capabilities and deep customer relationships, we intend to build a stronger, more diversified company positioned for sustainable growth.”
Mission is a leading global supplier of avocados with integrated operations, including value-added services such as ripening, packaging, regional distribution and logistics. The addition of Calavo is expected to create a scaled North American avocado and fresh produce platform primed for international expansion and to expand Mission’s presence in the high-growth prepared foods segment, according to the release.
Calavo’s two packinghouses in Michoacan and Jalisco will give Mission four packinghouses in Mexico.
Mission has previously expanded into produce categories including mangos and blueberries, and Calavo’s tomato and papaya offerings further diversify Mission’s portfolio.
Founded more than 100 years ago, Calavo offers fresh avocados sourced from California, Mexico, Peru, and Colombia; tomatoes; Hawaiian papayas; and a variety of ready-to-eat products such as guacamole and salsas. Its products are sold under the Calavo brand name and proprietary sub-brands as well as private labels and store brands.
“Over the past century, the Calavo team has built this company into a global leader in the sourcing and distribution of avocados, tomatoes, papayas and the processing of guacamole and other prepared foods,” B. John Lindeman, Calavo president and CEO, said. “We believe combining with Mission represents a compelling next chapter that will enable our combined business to unlock new growth and expand the impact of our trusted Calavo brand, while also providing our shareholders with compelling value and the opportunity to participate as a shareholder of a global leader in a growing sector.”
Upon close, Mission shareholders are expected to own approximately 80.3% of the combined company and Calavo shareholders are expected to own approximately 19.7%, according to the release.
The boards of directors of both companies have approved the transaction, which is expected to close by the end of August, subject to the receipt of required regulatory and shareholder approvals.
