Dole CEO required to warn of purchase

By Miles Weiss
Bloomberg News Service

WASHINGTON — Dole Food Co. Chief Executive Officer David H. Murdock, who is negotiating to acquire the fruit and vegetable producer, agreed to give its board notice before purchasing additional shares.

The agreement, disclosed in a filing with the Securities and Exchange Commission, coincides with Murdock's offer to buy, at $29.50 each, the Dole shares he does not already own, for a total of $2.5 billion.

In rejecting that offer as too low on Wednesday, Dole agreed to negotiate a higher price with Murdock.

The CEO already owns a 24 percent stake in Dole, which is based in Westlake Village, Calif. Under an agreement signed Wednesday, the board can learn whether Murdock is purchasing additional shares during the negotiations.

"We have been advised that it would not be in the best interests of Dole stockholders if you or any of your affiliates were to acquire additional shares of Dole" while the board considers his offer, the letter said, according to a copy included in the SEC filing.

The letter says Murdock must obtain prior written consent from the board committee considering his offer before acquiring additional shares, if such purchases would raise his stake beyond 25 percent.

If such consent were not obtained, Murdock would have five days' prior notice to buy shares.

Murdock's stake consists of 13.09 million shares owned outright, plus options to buy 494,148 shares in the next two months. In addition, Murdock includes 81,000 shares owned by his sons as part of the 24 percent stake reported to the SEC.

Dole shares rose 52 cents yesterday to close at $29.25 in New York Stock Exchange composite trading.