Mission Produce could join three-comma club with $1B-plus IPO
Mission Produce put a $1.18 billion price tag on its avocado operation, announcing in a Sept. 23 Securities and Exchange Commission filing that it plans to raise around $106 million in its initial public offering.
The Oxnard-based avocado distributor said it plans to offer some 6.25 million shares of common stock for $15-$17 per share. Existing shareholders also plan to sell 3.125 million shares, which would net them as much as $53 million in gross proceeds.
With 69.35 million shares outstanding and a price of $17 per share, the offering would value the company at around $1.18 billion. That would make it one of the 12 most valuable publicly traded companies in the tri-counties, using market capitalizations as of Sept. 23.
The filing said an additional 1.5 million shares will be reserved as an overallotment in case of high demand for the stock.
“We have a large and global footprint with locations in eight countries, which positions us to serve customers in a variety of markets,” the company said in its Sept. 4 filing. “We supply national grocers and foodservice customers through our sourcing and distribution network, and with our global platform we are able to grow with our existing customer base as well as expand into new markets.”
In its filings, Mission has reported $419 million in sales in the six months ended April 30, after distributing 559 million pounds of avocados in 2019. It recorded a net income of around $72 million in each of the prior two years, with around $880 million each year in revenue, but said it had a $13.4 million net loss in the first half of its current fiscal year.
Mission has four packing facilities in the U.S., Mexico and Peru, including a 200,000-square-foot former USPS packing facility in Oxnard it retrofitted in 2017 for $55 million to include automation and a solar array. It also has 11 distribution and ripening centers and three sales offices across North America, China and the Netherlands, according to the filing.
The company plans to list its stock under the symbol “AVO.” Bank of America Securities, J.P. Morgan Chase and Citigroup will act as book runners for the deal. Roth Capital Partners, Stephens and D.A. Davidson & Co. are listed as co-managers.
Mission has around 3,700 employees globally, including around 350 in the Tri-Counties. Mission estimated the domestic Hass avocado market alone at $6.5 billion in 2019 and said the U.S. was second only to Mexico in per-capita consumption.
Ventura County is currently home to two publicly traded agribusinesses: vertically integrated lemon producer Limoneira and avocado distribution company Calavo. Shares of Calavo have stayed around $65 in 2020, down from $90 or more in 2018 and 2019. Limoneira shares have hovered around $15 in recent months, about 20 percent lower than its price at the start of the year.
Several privately held brands also have a strong regional presence, including Sunkist, Naturipe and Driscoll’s, as well as produce giant Dole, which sold a 45 percent stake to European produce giant Total in 2017 and has its headquarters in Westlake Village.
In the Sept. 4 prospectus, Mission highlighted its vertical integration, with around 10,000 acres of production in Peru. It said its international expansion plans will include new supplier relationships and growing regions to diversify avocado sourcing and secure products year-round.