California company buys Hawaii papaya operations
Calavo Growers is buying Hawaii Pride and Hawaiian Sweet
of California has acquired papaya and tropical-product packing and processing operations on the Big Island for between $10 million and $14 million.
Calavo Growers is buying Hawaiian Sweet Inc. and Hawaii Pride LLC from Calavo's chairman, president and CEO Lee E. Cole.
The deal gives Calavo operations that pack an estimated 65 to 70 percent of all Hawaiian-grown papayas and 80 percent of Hawaii's exports to the mainland.
Calavo, which got its start in avocados, also acquired 3,000 acres on the Big Island, in addition to two fresh-papaya packinghouses and cooling facilities, and papaya and guava puree operations.
The acquisition comes on the heels of Calavo's deal with Maui Pineapple Company Ltd. to sell, market and distribute its Maui Gold fresh product throughout the continental U.S. and Canada in December.
Calavo, which presently ships about 200,000 pounds of fresh papayas to the mainland per week, believes there is plenty of room for growth. Since 1949, the company has sold and marketed Hawaiian papayas, which continued after Cole's acquisition of Hawaiian Sweet in the early 1990s.
"Calavo transitions from simply being paid a commission on its papaya sales to collecting full margin based on its ownership of the papaya and tropical-product operations," said Calavo chief operating officer Arthur J. Bruno. "We are confident that our company's depth of financial and operational resources, along with a growing position in the tropical-produce category, can propel these acquired assets to the next level."
Bruno said the company anticipates increasing the earnings of both Hawaiian Sweet and Hawaiian Pride, including more than $8 million in tangible assets from the collective packing and processing facilities and agricultural land, he said