Dole to sell assets to cover debt
Westlake Village, Calif.-based Dole Food Co., the world's largest fresh-fruit and vegetable producer, is facing its own credit crunch and is looking to sell off land in Hawaii and California to avoid defaulting on $350 million in bonds.
The revenue generated from the unidentified assets would be used to infuse emergency capital into the firm. Dole's $350 million issuance, one-third of the firm's outstanding debt, is set to mature in 2009 and has dropped 13 percent this year. A JPMorgan Chase & Co. valuation model of credit-default swaps suggests a 76 percent chance of default in the next five years, according to Bloomberg News.
Dole has seen its ability to repay debt dwindle after being hit with a more than a 100 percent increase in European banana tariffs in 2006 and facing recent dramatic increases in shipping costs. The firm, which reported $7 billion in revenue last year, has so far absorbed the added costs as it has been battling chief rival Chiquita Brands International Inc. in the European market.
Dole to sell assets to cover debt
