Calavo Growers (CVGW) M&A announcement summary

Deal rationale and strategic fit

• Combines two leading fresh produce companies to create a premier North American avocado and fresh produce platform with global reach, expanding into prepared foods, tomatoes, papayas, and guacamole.

• Entry into the high-growth prepared foods category, with a $1.7 billion addressable market growing in high single digits, complements existing value-added avocado business and aligns with evolving consumer demand.

• Strengthens vertical integration across sourcing, packing, ripening, logistics, and distribution, enhancing year-round supply reliability and mitigating seasonal troughs.

• Broadens grower networks, improves supply continuity and security, and enables a fully integrated model for improved operational efficiency.

• Strengthens position in North America and accelerates international expansion through scale, sourcing optionality, and a global distribution network.

Financial terms and conditions

• Calavo shareholders receive $27 per share: $14.85 in cash and 0.9790 shares of Mission for each Calavo share, valuing Calavo at approximately $430 million enterprise value, a 26% premium to its 30-day VWAP.

• Consideration is 55% cash and 45% stock, with Mission shareholders owning about 80.3% and Calavo shareholders about 19.7% of the combined company post-close.

• Cash portion funded by amended Mission Produce debt facilities, not contingent on additional financing.

• Termination fees set at 3.5% ($15.02mm) and 3.0% ($12.87mm) of enterprise value for reverse and standard termination, respectively.

• Transaction is a cash and stock deal, with both boards having approved the agreement.

Synergies and expected cost savings

• Identified $25 million in annualized cost synergies within 18 months post-close, with meaningful upside potential.

• Synergies expected from sourcing (7%), freight (16%), SG&A (48%), and packaging/distribution (29%), as well as streamlining organization and leveraging sourcing best practices.

• Total cost to achieve synergies is ~1.25x run-rate, realized within the first two years.

• Additional upside expected from revenue synergies and operational efficiencies, driving EBITDA growth and cash flow generation.

• Synergy target of $25 million considered conservative, with upside from operational efficiencies.