Some Shareholders Think $12/Share for Dole (DOLE) is 'Bananas'
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Following a bid made by CEO David Murdock to acquire Dole Food (NYSE: DOLE) at $12 per share in cash, the stock is seemingly trading above that range today. Do holders think that more might be in stock for the company?
Murdock took Dole private a decade ago, but had to sweeten his bid 14 percent to do so, Bloomberg notes today. The executive then brought the company back into the public market during 2009 for an offering price of $12.50 per share, just about where the stock is trading today.
BB&T and holder Adirondack Research think Dole could go for about $15 per share, using a sum-of-the-parts analysis and accounting for real estate assets. Bloomberg-compiled data also shows that the bid might be undevaluing the company; the $12 offer was 15 percent above Dole's 20-day moving average price, versus a 28 percent premium garnered by other U.S. food companies valued over $1 billion with an initial offer.
It might also seem like an opportunistic offer. Dole lowered its earnings guidance with its latest report, also announcing suspension of its dividend. The combination helped shares to move as low as $9.27 in early June. The stock reached a 52-week high of $15.19 last September.
Private equity might also take a gander at Dole. One analyst from Adirondack noted that there would always be a demand for its products and it might be able to improve cash flows and returns in a private setting.
Shares are down 0.2 percent Thursday.
Murdock took Dole private a decade ago, but had to sweeten his bid 14 percent to do so, Bloomberg notes today. The executive then brought the company back into the public market during 2009 for an offering price of $12.50 per share, just about where the stock is trading today.
BB&T and holder Adirondack Research think Dole could go for about $15 per share, using a sum-of-the-parts analysis and accounting for real estate assets. Bloomberg-compiled data also shows that the bid might be undevaluing the company; the $12 offer was 15 percent above Dole's 20-day moving average price, versus a 28 percent premium garnered by other U.S. food companies valued over $1 billion with an initial offer.
It might also seem like an opportunistic offer. Dole lowered its earnings guidance with its latest report, also announcing suspension of its dividend. The combination helped shares to move as low as $9.27 in early June. The stock reached a 52-week high of $15.19 last September.
Private equity might also take a gander at Dole. One analyst from Adirondack noted that there would always be a demand for its products and it might be able to improve cash flows and returns in a private setting.
Shares are down 0.2 percent Thursday.
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