Moody's eyes Dole Food for upgrade

Moody's Investors Service said it placed all the ratings of Dole Food Co., Inc. on review for upgrade, including its B1 first-lien term loan rating and Caa1 third-lien note rating.

The review for upgrade follows Total Produce plc's announcement it plans merge with Dole under a newly created, U.S. listed company Dole plc.

The combined entity is expected to have pro forma 2020 revenues of about $9.7 billion compared to Dole's $4.6 billion in revenues for the 12 months ended Oct. 3, 2020.

“In addition, the new entity, Dole plc, is expected to have a target net debt/adjusted EBITDA of approximately 3x, based on company calculations, which is meaningfully lower than Dole's Moody adjusted net debt-to-EBITDA of 5.6x for the 12months ended Oct. 3, 2020. Lastly, the new entity will be publicly listed, which will likely improve Dole's governance. Dole plc plans to raise $500 to $700 million through an initial public offering, which it will use to strengthen and de-lever the combined entity's balance sheet,” the agency said in a press release.

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