Dole CEO Makes Offer to Purchase All Remaining Shares (DOLE)

In a move that redefines, “skin in the game,” Dole Food’s DOLE Chairman and CEO David Murdock and his family made an offer to the Dole board to purchase the remaining outstanding shares of the company for $12 per share Tuesday morning.

This implies a value of about $1.07 billion. Yahoo Finance lists the company’s market cap at $902.48 million. Murdock’s bid represents an 18 percent premium over Dole’s closing price of $10.20 on Monday.

According to Reuters, Murdock currently owns 40 percent of the company and would purchase about 89.5 million shares if the deal were approved. Dole would become a private company.

Who is David Murdock? Currently worth about $2.4 billion, Murdock is ranked #613 on the Forbes Billionaires list and #190 on the Forbes 400. He has been the CEO of Dole since 1985 after he took over an almost-bankrupt Hawaiian firm, Castle & Cook—the company that owned pineapple and banana producer, Dole.

Over time, he built the company into the world’s largest producer of fruits and vegetables. Since that time, Murdock acquired Dole privately in 2003, took it public in October of 2009 for $446 million, and, once again, wants to take it private for $1.07 billion. He plans to use a combination of cash and financing to complete the deal.

In April, Dole sold its worldwide packaged foods and Asia fresh produce business to Japanese trading company Itochu for $1.7 billion. This left Dole with only the fruit and vegetable operations.

How common is it for a CEO to purchase the company they run? Not common but another high profile deal involving similar circumstances is unfolding. CEO Michael Dell, founder of Dell DELL, owns about 14 percent of the company through his quarter of a billion shares. He is planning to take the company private despite activist Carl Icahn’s attempts to block the deal.

According to Forbes, the Dell board of directors made it a little easier for Dell by awarding him additional shares as a compensation package.

As for Murdock, he has received a “highly confident” letter from Deutsche Bank, according to the company press release.

As for Dole, it is setting up a special committee of independent directors to consider the proposal.

In pre-market trading Tuesday, shares of Dole were up about 16 percent at $11.85.

Disclosure: At the time of this writing, Tim Parker had no position in the companies mentioned.