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Tag: Del Monte

  • Del Monte Partners with Riverking to Expand Fresh-Cut Fruit in China

    Del Monte Partners with Riverking to Expand Fresh-Cut Fruit in China

    Del Monte Corp. Has formed a joint venture with Shanghai-based Riverking to sell fresh-cut fruit across China, targeting an Asian business that generated 9 per cent of its sales.

    The partnership, signed through Hong Kong subsidiary Del Monte Fresh Produce (HK), links the New York-listed group with Riverking’s network of 11 distribution centres across mainland China.

    Riverking was founded in 2003 and handles supply chains spanning cultivation, sourcing, harvesting and cold-chain distribution. Outside mainland China, the Shanghai firm operates international offices in Thailand, Australia, New Zealand, North America and South America.

    Distribution Across Eleven Hubs

    Fresh and value-added items delivered $2.62bn of Del Monte’s $4.32bn total revenue last year, while bananas contributed $1.49bn. The group, which changed its corporate name from Fresh Del Monte Produce in June, relies on third-party distributors across China, Hong Kong, Japan and South Korea.

    Up to now, South Korea housed the company’s only dedicated fresh-cut processing facility in East Asia. Partnering with an established domestic handler in Shanghai gives the brand immediate cold-storage reach into Chinese supermarket shelves without building out an entire standalone logistics fleet from scratch.

    Portfolio Realignment After Asset Deals

    The China agreement follows several portfolio shifts by Del Monte over the past year. In January, the group purchased vegetable, tomato and refrigerated fruit lines from California-based Del Monte Foods in a US bankruptcy transaction, after buying a majority stake in Ugandan avocado oil producer Avolio.

    Competitors in China’s packaged produce sector face high spoilage risks and fragmented retail networks. For Del Monte, the next metric to watch is whether Riverking’s 11 regional hubs can lift Asian sales above their current 9 per cent share of total revenue.

  • Del Monte Foods Files For Chapter 11 Bankruptcy To Facilitate Business Sale

    Del Monte Foods Files For Chapter 11 Bankruptcy To Facilitate Business Sale

    Del Monte Foods, a renowned food production company, has recently applied for Chapter 11 bankruptcy protection within the United States. This move comes as a part of the company’s strategy to facilitate a successful sale of its business operations.

    Restructuring Support Agreement

    In order to conduct a comprehensive sale of all or most of its assets, Del Monte Foods has settled on a restructuring support agreement (RSA) with several of its lenders. Furthermore, to maintain sufficient liquidity throughout this transition, the company has secured a staggering $912.5 million in debtor-in-possession financing.

    Despite the ongoing bankruptcy proceedings, the company intends to keep its business operations running normally and without any interruptions.

    A Necessary Step Towards a Brighter Future

    The company’s President and CEO, Greg Longstreet, has acknowledged the challenging circumstances that have been accentuated by a rapidly changing macroeconomic environment. Longstreet stated, “After thoroughly evaluating all possible options, we concluded that a court-supervised sale process is the most effective method to expedite our turnaround and establish a stronger and more resilient Del Monte Foods.”

    He further added that the company, with a renovated capital structure, improved financial position, and new ownership, will be better equipped to ensure long-term success.

    A Rich Heritage

    Founded in 1886, Del Monte Foods boasts a vast portfolio including the canned fruits and vegetables brand Del Monte, the broth and stock business College Inn, and tea brands like Joyba. It should be noted, however, that certain non-US subsidiaries of the company are not part of the Chapter 11 proceedings and continue to operate as regular.

    Clarification on Affiliations

    In a recent development, Fresh Del Monte Produce Inc, which is listed on the NYSE, clarified that it has no financial or operational ties with Del Monte Foods. The two companies are entirely separate entities, with no shared ownership, governance, or operations.

    While both companies have rights to the Del Monte name due to historic licensing arrangements, they operate under unique ownership and cater to different geographical markets.

    Questions & Answers

    What is the purpose of Del Monte Foods filing for Chapter 11 bankruptcy?
    The company has filed for bankruptcy to facilitate a successful sale of its business.

    How will Del Monte Foods maintain operations during the bankruptcy proceedings?
    The company has secured $912.5 million in debtor-in-possession financing to ensure sufficient liquidity throughout the process.

    Are Fresh Del Monte Produce Inc and Del Monte Foods affiliated?
    No, the two companies are entirely separate entities, with no shared ownership, governance, or operations.

  • Del Monte seeks to raise up to $333m via IPO

    Del Monte seeks to raise up to $333m via IPO

    Del Monte Philippines Inc, the wholly-owned Philippine subsidiary of global branded food and beverage firm Del Monte Pacific Limited, has received approval from the Securities and Exchange Commission (SEC) to raise up to P17.55 billion (about $333 million) via an initial public offering (IPO).

    This would mark the second IPO in the Philippines so far this year following the approval by the SEC of the IPO application of construction and property developer DM Wenceslao early this month. The Philippine Stock Exchange (PSE) is still optimistic of having eight IPOs in the entire year.

    In a statement released on Thursday, the SEC said it has approved Del Monte’s IPO, which involves 587.437 million secondary shares to be sold at P29.88 ($0.57) per share. This represents 21 per cent of the firm’s outstanding capital stock.

    “The company will not directly receive any net proceeds from the offer… no amount of the proceeds will be used to reimburse any officer, director, employee for services rendered, assets previously transferred, money loaned or advanced, or otherwise,” the country’s corporate regulator said.

    Del Monte Pacific earlier said it intends to use the proceeds from the offer to partially prepay or repay certain loan facilities.

    “The balance of proceeds, if any, will be used for general corporate purposes. The prepayment of such loans will allow the Del Monte Pacific Limited Group to deleverage and strengthen its balance sheet,” Del Monte Pacific said.

    According to the SEC document, about 70 per cent of the offer shares is earmarked to be sold to domestic investors, while the remaining 30 per cent will be sold to foreign institutional and retail investors.

    Del Monte Philippines is engaged in the production and sale of food and beverage products – such as fruit juices and juice drinks, packaged pineapple and mixed fruit, various tomato, spaghetti sauces and culinary mixes – in the Philippines under the Del Monte brand and exports these products under the S&W brand.

    It also operates one of the world’s largest fully-integrated pineapple operations and has been growing and processing pineapple for over 90 years.

    The PSE expressed confidence that at least eight IPOs will be conducted this year even as only two firms have filed IPO applications with the SEC so far – Del Monte and DM Wenceslao.

    The PSE posted a net income of Php825 million ($16 million) for the full-year 2017, an increase of 18 per cent from the Php702 million it generated in 2016, according to the unaudited consolidated financial statement posted on its website.

  • Del Monte retail chain to launch in US

    Del Monte retail chain to launch in US

    Three Del Monte entities will launch a series of JVs, including a Del Monte retail concept to be rolled out in the US.

    Del Monte Pacific (DMPL), a subsidiary of Del Monte Foods and Fresh Del Monte Produce have agreed to launch the retail F&B concept modelled after a Fresh Del Monte Produce business in the Middle East. They also agreed to expand the distribution of refrigerated goods internationally.

    Initially the focus of the Del Monte retail stores will be in the US market with the potential for expansion into other territories, says DMPL, which is dual listed in the Philippines and Singapore.

    The stores will offer foods and beverages aimed at consumers seeking healthier options. The companies are also collaborating on product innovations, including a line of chilled juices, new varieties of prepared refrigerated fruit snacks, and guacamole and avocado products.

    As well as Del Monte, the group’s heritage brands include College Inn, Contadina and S&W, most of which originated in the US more than a century ago as premium packaged-food products. The group has exclusive rights to use the Del Monte trademarks for packaged products in the US, South America, the Philippines, the Indian subcontinent and Myanmar.

    DMPL is 67 per cent owned by NutriAsia Pacific and Bluebell Group Holdings, which are beneficially owned by the Campos family of the Philippines. The NutriAsia Group sells liquid condiments, specialty sauces and cooking oil in the Philippines.

    The JVs follow the full and final settlement of active litigation between the companies, which had been centered on licensing rights and product distribution in various international territories.

  • Del Monte Pacific recovers from losses, records $12m profit

    Del Monte Pacific recovers from losses, records $12m profit

    Del Monte reported a profit for the quarter ending in January, reversing losses incurred in the previous period.

    For the past quarter, Del Monte achieved an US$8.46m ($12m) net profit, on the back of strong sales in Asian markets particularly in the Philippines and the operational efficiency improvements resulting in cost reduction.

    Overall sales were US$604m, slightly higher than in the prior-year period as strong sales in Asia offset lower sales in the United States.

    “We continue to build on the consumption-driven growth in Asia as our team optimises opportunities in both the retail and foodservice sectors,” said Joselito Campos, Jr, managing director and Group CEO of DMPL.

    The Group’s US subsidiary, Del Monte Foods, Inc (DMFI), contributed US$450.6m or 75% of Group sales. US sales declined by 3% versus the same period last year driven by the continued weakness in the canned fruit industry, lower sales of regional brands in the packaged vegetable category across retail and foodservice due to supply-related issues, and lower sales of private label.

    “Our US business continues to be impacted by shifting consumer preferences, and our performance in the foodservice and private label sectors. We are implementing a strategy based on innovation and differentiation in existing categories, whilst seizing opportunities in other categories and channels to address consumer demands,” Campos explained.

    However, amidst industry contraction, DMFI increased its market share in two of the four major categories in retail, i.e. packaged vegetable and broth, which was further supported by the growth of the branded business amongst major retail customers.

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