DUAL-LISTED fruit canner Del Monte Pacific Ltd. (DMPL) said on Wednesday it has signed a joint venture agreement with Fresh Del Monte Produce, Inc. (FDMPI) for the production of expanded refrigerated products and a new retail food and beverage concept.
DMPL told the Philippine Stock Exchange the joint venture will initially focus on the US market, with a potential expansion into other territories where the companies’ businesses complement each other.
“This will also greatly increase the scale of the Del Monte brand by expanding into more high-quality, healthy and convenient product options for consumers,” DMPL said.
One of the major initiatives of the joint venture is the introduction of DMPL’s branded retail outlets featuring an assortment of nutritious foods and beverages to meet the increasing demand of consumers for healthier food options.
Likewise, the companies will be partnering on several product innovations including a line of chilled juices, new varieties of prepared refrigerated fruit snacks, and guacamole and avocado products.
“The collaboration offers the opportunity for each partner to share expertise and optimize economies of scale in product development, operations, sourcing, supply chain, marketing and distribution,” the company said.
The joint ventures are facilitated by the full and final settlement of all active litigation among DMPL, its subsidiary Del Monte Foods, Inc. and FDMPI, effective immediately. The long-standing litigation had centered on licensing rights and production distribution in various territories around the world.
“We are pleased that we have resolved our differences and put to rest the financial uncertainty that can arise from prolonged litigation,”DMPL Board Chairman Rolando Gapud said.
“We look forward to combining the resources of Del Monte Pacific, our US subsidiary Del Monte Foods, and Fresh Del Monte Produce, and focusing our joint efforts on exciting new business opportunities that will provide consumers with more premium quality, healthy products,”he added.
On the other hand, FDMPI Board Chairman and Chief Executive Officer Mohammad Abu-Ghazaleh said the partnership “offers tremendous opportunities for both companies to innovate on a much broader and deeper scale than either company can accomplish individually.”
“Each company brings a high level of knowledge, experience and commitment that comes from developing and building the iconic, trusted Del Monte brand. We also share similar visions for creating products and experiences that will meet the evolving needs of today’s consumer,” he said.
In addition to retail and new product ventures, the companies have also agreed to a long-term mutual supply agreement to accelerate the expansion of Del Monte product sales in various markets around the world.
Del Monte is the first company approved by local regulators to sell dollar-denominated securities (DDS).