Dole rejects Murdock’s
bid to acquire company

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Star-Bulletin staff and news services

WESTLAKE VILLAGE, Calif. >> Fresh fruit producer Dole Food Co. Inc. said yesterday a board committee had rejected a buyout proposal by Chairman and Chief Executive David Murdock and asked Goldman Sachs to find potential buyers.

Westlake Village, Calif.-based Dole said a special committee of its board of directors had rejected an offer by Murdock to acquire the 76 percent of its common stock that he or his family does not already own.

Murdock had offered $29.50 a share in cash, for a total price of more than $1.2 billion. The company said in a statement the committee had begun talks with Murdock to see if he would offer a higher price for the shares.

Murdock, who had initially set a Nov. 6 deadline for a deal to be reached before his offer expired, has extended that deadline to Nov. 13 in light of the talks, Dole said.

Meanwhile, Murdock has agreed to notify the company before increasing his stake above 25 percent, he holds a 24 percent stake, according to a regulatory filing today.

His agreement with the company, signed yesterday, doesn't require him to provide notice before initiating a tender offer in response to a tender by a third party, the filing said.

Murdock hasn't reported any open-market purchases of Dole common stock since April 1999, though he has acquired stock in private transactions, according to SEC filings.

The agreement remains in effect until he acquires majority control of the company through a committee-approved transaction or until Jan. 30, 2003, the filing said.

Shareholders immediately responded to Murdock's initial bid by filing suit to block any transaction. One suit called the offer "wrong, unfair, harmful to Dole Food public stockholders (and) woefully inadequate."

In a suit, a group of shareholders said they expected a bid of $35 to $40 for their stock.

Shares in Dole closed up 52 cents today at $29.25 on the New York Stock Exchange.

Since Murdock's Sept. 22 buyout offer, the shares are up 17 percent. Shares have ranged from a year high of $33.99 to a low of $19.10.

Murdock in 2000 made a similar move to acquire control of Hawaii-based Castle & Cooke Inc.

Murdock had owned 27 percent of the company when he launched a bid for control, and was forced to up his offer to $19.25 a share from $17, eventually buying the company for about $615 million, including the assumption of debt.

Murdock, No. 149 on Forbes magazine's list of the 400 richest Americans with a net worth of $1.3 billion, baled Dole out of financial trouble in 1985, gaining control. He later spun off Castle & Cooke, which among its properties owns 98 percent of the island of Lanai.