Del Monte Foods Co., the world's largest producer of canned fruits and vegetables, will try to raise about $227 million through an initial stock offering, using the money to reduce its debt, according to filings Thursday with the Securities and Exchange Commission.
As it moves toward becoming a public company, San Francisco-based Del Monte also plans to build on its well-known brand name, developing new products and pursuing acquisitions of other food brands, the filings said.
The Del Monte filing did not say how many shares the company will sell, nor did it disclose the expected price range or other details.
Following an April 1997 recapitalization, Texas Pacific Group, an investment partnership that includes financier David Bonderman, obtained a controlling interest in Del Monte.
Texas Pacific brought in two former Dole Food Co. executives to run operations at Del Monte. Richard G. Wolford, 53, is chief executive and Wesley J. Smith, 51, is chief operating officer.
Richard W. Boyce, 43, a Texas Pacific associate, is Del Monte's chairman.
The IPO could raise as much as $227 million after expenses to repay or redeem debt, the filing said. Some of the debt stems from Del Monte's $197-million purchase of the Contadina brand of canned tomato products from Nestle's.
On an adjusted basis to reflect the planned IPO and subsequent debt repayment, Del Monte had about $1.2 billion of debt on Dec. 31, the filing said.
The company also has taken steps to cut costs. In January, it said it will shut two older California plants over the next two years in favor of more modern facilities.
For the six months ended Dec. 31, Del Monte reported net income of $3 million on net sales of $620 million. For the same period a year earlier, the company reported net income of $5 million on sales of $628 million.
Earnings before taxes, interest, depreciation and amortization increased to $59 million for the recent six-month period, from $54 million the year before.
Del Monte split from Fresh Del Monte Produce Inc. in 1989.