Calavo Growers receives acquisition proposal valued at $32 per share

SANTA PAULA, Calif. - Calavo Growers, Inc. (NASDAQ:CVGW) announced Wednesday it has received a non-binding proposal to acquire all of its outstanding shares for approximately $32.00 per share, representing a 36% premium to the current trading price of $23.58. The proposed transaction would include a combination of stock from the acquiring party and cash. According to InvestingPro data, the company currently has a market capitalization of $420 million.

The avocado and fresh produce distributor did not disclose the identity of the potential buyer in its statement. The proposal remains subject to several conditions, including due diligence and financing arrangements.

Calavo’s Board of Directors is currently reviewing the unsolicited offer with its legal and financial advisors. The company emphasized that the non-binding proposal may not result in a transaction.

Founded in 1924, Calavo Growers operates as a processor and distributor of avocados, tomatoes, papayas, and guacamole products. The company sells products under its Calavo brand as well as through private labels and store brands. With annual revenue of $694 million and a strong financial health rating from InvestingPro, the company has maintained dividend payments for 24 consecutive years.

The Santa Paula-based company maintains facilities throughout the United States and Mexico, serving retail grocery stores, foodservice businesses, club stores, mass merchandisers, and food distributors.

Calavo stated it does not intend to provide further updates on the proposal unless warranted. The announcement was made in a press release statement issued by the company. InvestingPro analysis reveals several additional key metrics and insights about Calavo’s financial position, with 8 more exclusive ProTips available to subscribers.

In other recent news, Calavo Growers reported second-quarter earnings that did not meet analyst expectations. The company announced adjusted earnings per share of $0.40, falling short of the consensus estimate of $0.54. Revenue was reported at $190.5 million, which was below the expected $192.75 million. Despite a 3.3% year-over-year increase in total net sales, driven by a 4.7% rise in the Fresh segment, the Prepared segment experienced a decline of 9.9%. Gross profit decreased by 11.9% to $18.1 million, attributed to lower avocado volumes and weaker performance in the tomato business. Calavo Growers’ CEO, Lee Cole, highlighted strong pricing performance but acknowledged challenges in tomato sales. Looking forward, the company anticipates growth in its Prepared segment and continued strength from the California avocado season. These developments reflect the company’s ongoing efforts to navigate market volatility.

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