Dole IPO Down Over 9% in First Day of Dealing

What happened: Shares of the world’s largest fresh produce company fell more than 9% on Friday after debuting on the New York Stock Exchange. dole (NYSE: DOLE) opened for trading at $15, against an implied market cap of approximately $1.5 billion, which was lower than its initial public offering of $16. The stock closed Friday at $14.50, giving the company a market value of $1.35 billion. The timing was what it was, the valuation is what it is, Chief Executive Officer Rory Byrne said in an interview.

This was the company’s third attempt to go public, after an initial offer of 26 million shares for $20 to $23 on Tuesday, and then a second share sale of 30.3 million shares for $16 to $17 dollars. on Thursday. Fridays IPO ended up selling just 25 million shares and raising $400 million in gross proceeds.

Why it’s important: The IPO comes after Dole’s successful merger with Total Produce, a deal announced in February. According to the filings, the combined company generated $58 million in net income with sales of $2.3 billion in the first quarter of this year. Byrne says the iconic Dole brand is positioning the company to attract investors and drive future growth.

Dole has already applied to go public twice in recent years. David H. Murdock delisted the company in 2003 to avoid bankruptcy, it was relaunched in 2009 and delisted in 2013. IPO filing in 2017 was withdrawn the following year.

What’s next: The company plans to use the money raised by the IPO about merger costs and repayment of its debt. Byrne says he doesn’t expect a material impact on Dole from an ongoing drought in California. As of March this year, the company owns more than 109,000 hectares of land worldwide.

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