I read Jason’s article today. I am surprised to hear that Dole Foods is in a bad financial situation. Doles Foods is selling its land in Hawaii to pay off its debts.
First of all, I don’t exactly know what was DF’s problem. It could be the management team, market strategy, or other operating issues. What are some opportunities that DF is facing? Just like the Delta Beverage case we did in class, DF is facing the future of being bought out and shut down. If DF decides to announce its bankruptcy, DF will shut down its production lines and no cash flow will be generated at all. However, if DF can be bought out, it might be able to pay off its debts and survive through this. Another issue that I have noticed is that DF owns land in Hawaii, which is outside the United States. Shipping costs is a big part of DF’s debts. In order to lower its cost, DF can sell its land in Hawaii and purchase land nearby in the United States.
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