Dole in $1.7 bln deal with Japan's Itochu

The US fruit giant Dole announced it has reached a deal to sell its worldwide packaged food and Asia fresh produce businesses to Japanese trading house Itochu for nearly $1.7 billion. The $1.685 billion deal is still subject to approval from shareholders and regulatory authorities in "multiple countries" the company said in a statement, released on Monday. "Cash proceeds from the transaction will be used by Dole for debt reduction, to pay deal-related expenses, and for restructuring and other corporate purposes," it said. Dole Worldwide Packaged Foods produces canned fruit, frozen fruit and fruit juice, as well as fruit parfaits and other snacks. Dole Asia Fresh Produce grows, sources, transports and distributes fresh fruits and vegetables. The combined revenue of the two businesses totaled approximately $2.5 billion in 2011, Dole said. "We are realizing a premium valuation for our worldwide packaged foods and Asia fresh produce businesses and will retain a strong fresh produce business that has increased financial flexibility to grow," CEO David DeLorenzo said. Dole will retain its vast operations elsewhere in the world, which generated some $4.2 billion in revenues in 2011, the company said. Itochu said last week it would set up a new company in Tokyo to purchase the Dole operations, subject to a finalized deal. Itochu is one of Japan's biggest trading houses, dealing in everything from textiles and machinery to chemicals and food.