David H Murdock and Dole Food Co Inc have signed a definitive merger agreement that allows Murdock to acquire about 76% of Dole's outstanding common stock that he and his family do not own for $33.50 per share in cash. The per-share consideration places the total enterprise value of Dole, which includes the assumption of debt, at approximately $2.5 billion.
The transaction has been unanimously approved by the board of directors of Dole, with Murdock abstaining, after the unanimous recommendation of a Special Committee of outside directors of Dole that was formed Sept 24, 2002 to respond to Murdock's original proposal of $29.50 per share, in cash.
The proposed transaction price of $33.50 per share represents an increase of $4.00 per share (or 14%) over Murdock's original proposal, and a 37% premium over the $24.49 per share price of the stock before Murdock's proposal Sept 22, 2002.
Dole will file proxy materials with the Securities and Exchange Commission for a special meeting of stockholders to vote on the proposed merger of DHM Acquisition Co Inc, which is wholly owned by Murdock, into Dole. The meeting likely will be held in late February or early March 2003.
The merger is also conditioned upon approval of the merger by stockholders who own a majority of the outstanding shares which Murdock or his family do not already own. If the merger is approved, any shares not owned by Murdock will be converted into the right to receive $33.50 per share in cash.
In a related development, Murdock and Dole's board of directors have reached a settlement in certain class action lawsuits that had been filed by shareholder plaintiffs in response to Murdock's initial proposal. The settlement, which has been memorialized in a memorandum of understanding, requires court approval, and is intended to resolve all claims that have or may be filed in connection with the proposed merger and related disclosures. The settlement has been accepted by a majority of the putative class representatives.