67 Comments

Guess the revised IPO range doesn't change your thesis much? you initially estimated TP shareholders' ownership in Dola at ca 55% it's now being reduced from 61.5% to 57.1% using the new range? thank you

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Thanks for sharing! Nice write up. Is there a time gap between the de-listing and US IPO that we cannot trade the stock?

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great read, just one question. When you mention "I believe a market re-rating of Dole is likely within a 12-24 month time-frame. The recent listing experience of peer Mission Produce (AVO), a much smaller and niche avocado producer, supports this thesis - AVO initially listed on the Nasdaq at $12/share (~11x) in Oct-20, before re-rating to $21/share (~16x – 17x) by Feb-21."

Are you referring to EV/EBITDA multiples?

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Thanks for an excellent write-up, despite the unfortunate (or fortunate) price action over the last 3M. A pretty compelling setup at this point.

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Does anyone also have the problem of not being able to sell the merged stock? According to my broker, Euroclear does not allow to make the original shares (registered in Ireland) tradeable in the US, which sounds really weird.

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What am I missing? The IPO price range is 16 to 17 USD, lets take the midpoint of this, 16.5. 7 TP shares give 1 new share, so 1TP share is worth 16.5/7=2.35 USD = 2 Euro, which is 15% BELOW the current TP of 2.32 EUR, ever after the drop. So I am buying into an expected loss?

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when do these stop trading? I thought July 23 but i see i a big loss on my P&L today, ha

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Thanks for writing this Conor, a couple of questions if possible:

- Peers multiples and valuation: why 15x? I know the company mentioned Lamb Weston, Calavo and Mission. But these are more specifically linked to french fries and avocados (with different dynamics). Closest peer is Delmonte which trades at 9x. Greenyard in Belgium trades at 7.2x EBITDA and Bonduelle at 7.8x.

- Net debt: how do you get to $0.9bn vs the $1.1bn indicated in the F1?

thank you for your work in writing up the idea

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Really liked the report, thank you for sharing. A couple questions I had:

Do you think a lot of the existing TOT ID holders will be forced sellers once this is listed in US? Looking through the holders list seems like a lot of these guys are Europe-focused, but I could be wrong. If so, do you think it's better to buy ahead of the IPO, or wait until afterward and that potential selling pressure?

The LTM EBITDA as of 1q21 is ~$400mm (which is presumably before synergies) and that seems to be what they're guiding the street to in 2022. Is there something abnormally positive in the LTM period? I would have thought EBITDA should grow from the LTM period, especially given the synergies? Is there a reason the organic biz should decline over the next 1-2 years before returning to their long-term growth algo? Also, do you know if the 5-7% adj ebitda growth is meant to be inclusive of realizing synergies, or do you think synergies should layer in on top of that base growth?

The minority interest expense running through the combined income statement was ~$24mm in 2020. Do you know specifically what this is or if this is something they pay out in cash annually? I think you mentioned you just add $130mm to the TEV calc, but was curious why not capitalize at the same multiple you apply to the rest of the business?

Thanks again for the write up.

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When is it specteb to be delisted from europe? You said late july but dobwe know the date? Thaks a lot!!! Great work!

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Interactive brokers won’t trade Euronext listed stocks. Is it safe to buy the one listed in London aside from getting a little screwed on currency and lack of liquidity?

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Are there any unusual tax consequences or stamp fees related to the share exchange and re-listing that you're aware of? I didn't see anything out of the ordinary but curious if you did

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Sorry if this is a stupid question, but is there any incentive to underprice the IPO, and how many shares do you think they will issue? If you have access to the IPO, do you think it will price above the current price of TP (should you buy shares now or wait for the IPO if you can buy at the IPO price)? Thanks in advance for any response.

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Conor - Thanks for the writeup. Trying to find interest expense on the new debt. Do you have a ballpark number? Looks like the old Dole debt was around 6%

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Hi. Really great in depth analysis.

Do you know which will be the conversion rate of existing Total Produce shares to the new company? Each share will be converted to the new company?

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Great write-up really love this. Just echoing Eason's question. Is there a time gap between the de-listing and US IPO that we cannot trade the stock? And how do those mechanics work do the shares just sit in our account with no volume?

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