Mission Produce to Buy Calavo Growers for $27/Share, Targets $25M Synergies by 2026 Close

Key Points

• Mission will acquire Calavo for $27 per share ( $14.85 cash + 0.9790 Mission shares), leaving Mission shareholders with ~80.3% of the combined company; the deal is expected to close by end-August 2026, with John Pawlowski to serve as CEO and Steve Barnard as executive chairman.
• Mission expects $25 million of annualized cost synergies to be realized within 18 months and projects a pro forma fiscal 2025 profile of revenue north of $2 billion and Adjusted EBITDA of about $176 million, with net leverage around 2.4 after the transaction.
• The acquisition adds Calavo’s prepared foods platform (branded and private-label guacamole, salsas and dips) and two packing houses in Michoacán and Jalisco—bringing Mission’s Mexico network to four—to diversify products, smooth avocado seasonality, and accelerate international expansion.

Mission Produce NASDAQ: AVO executives said the company has entered into a definitive agreement to acquire Calavo Growers in a cash-and-stock transaction aimed at expanding Mission’s scale, diversifying its product mix, and adding a prepared foods platform. Leaders from both companies discussed the strategic rationale, deal structure, expected synergies, and integration priorities during a conference call held shortly after the announcement.

Deal overview and leadership plans

Under the terms described on the call, Calavo shareholders will receive $27 per share, consisting of $14.85 in cash and 0.9790 shares of Mission for each Calavo share. Based on shares currently outstanding, Mission shareholders are expected to own approximately 80.3% of the combined company, with Calavo shareholders owning approximately 19.7%.

Mission President and COO John Pawlowski said both companies’ boards have approved the transaction, which is expected to close by the end of August 2026, subject to customary regulatory and shareholder approvals. Following the close, Pawlowski said he will serve as CEO of the combined company, while Mission CEO Steve Barnard will become executive chairman.

Strategic rationale: diversification and expanded footprint

Mission executives framed the acquisition as a combination of complementary capabilities. Barnard described Calavo as a “longtime” neighbor and “respected leader” in the global avocado market, adding that the deal is intended to build “a stronger, more diversified company positioned for long-term sustainable growth.”

Pawlowski highlighted Mission’s existing global sourcing and distribution footprint across North America, Europe, the U.K., and Asia, and said Calavo adds a long operating history as “the original North American avocado company” as well as a prepared foods platform including guacamole, salsas, and dips. He said Calavo’s offerings also include tomatoes and papayas, which Mission expects to further diversify its produce portfolio and help smooth seasonal variability in avocados.

Executives said the acquisition is expected to strengthen Mission’s position in North America while accelerating international expansion through greater scale and “sourcing optionality.” They also described the combined business as a more vertically integrated platform with improved reliability, stronger sourcing security, and improved ability to operate efficiently across seasons.

Operations and sourcing: Mexico packing capacity and network optimization

On sourcing, Pawlowski emphasized the value of expanded scale in Mexico and California. He said Calavo has two packing houses in Michoacán and Jalisco, which would expand Mission’s network to four packing houses in Mexico. The company described the expanded footprint as a way to provide a more consistent year-round supply with improved fill rates, ripening programs, and logistics flexibility.

In the Q&A, executives also addressed facility utilization and potential consolidation. Barnard noted that Mexico was experiencing one of its highest seasons in the past five to six years in terms of fruit volume coming in. He said Mission sees opportunities to “optimize” the combined network, particularly where there are complementary locations within the U.S., while also expecting to utilize capacity by continuing to operate facilities in a way that effectively uses available throughput.

Prepared foods expansion and market opportunity

Mission presented entry into prepared foods as a key strategic benefit. Pawlowski said Calavo’s prepared foods portfolio spans branded and private label guacamole, salsas, and plant-based dips sold to grocery retailers and foodservice providers. He cited consumer demand for “fresh, convenient, and better-for-you options,” and said the total addressable market for this segment is approximately $1.7 billion and growing in the high single digits.

Calavo CEO John Lindeman said Calavo’s prepared segment has been a “nice growth engine” and that 2025 could be a promising year for the business. He said Calavo added several new customers in 2025 and introduced new products that are “gaining share.” Lindeman also said Calavo has had some international success developing customers in the category, and that Mission’s broader geographic reach and ability to invest could support expansion as throughput pressures infrastructure.

Financial expectations and synergy targets

Mission outlined both a pro forma combined financial profile and a synergy target. Pawlowski said that on a pro forma basis in fiscal 2025, the combined company would have generated approximately $2 billion in net sales and $176 million in Adjusted EBITDA. He also said Mission currently delivers approximately $1.4 billion in revenue and that Calavo would add approximately $648 million. Inclusive of synergies, he said the company expects revenue “north of $2 billion,” combined EBITDA of approximately $176 million, and an Adjusted EBITDA margin of 8.6%.

Regarding synergies, Mission said it has identified $25 million of annualized cost synergies expected to be realized within 18 months post-close, with what it described as “meaningful upside potential.” Pawlowski said cost synergies are expected to come from:

• Streamlining the organization
• Optimizing the distribution center network to scale operational efficiencies
• Improving freight and packaging costs
• Leveraging best practices in sourcing

In response to an analyst question about revenue synergies, Pawlowski did not provide a quantitative estimate, but said the combined sourcing strength and marketing capabilities should improve the ability to deliver 52-week programs, optimize pricing and promotions, and expand commercial opportunities. Lindeman added that Mission’s international reach could provide additional outlets for Calavo’s prepared foods business in regions where Calavo is underrepresented.

Pawlowski also said Mission expects to maintain strong cash flow generation and that the company will have a net leverage ratio of approximately 2.4 after the transaction.

Calavo’s Lindeman said the structure of the deal, with about 45% of the consideration in stock, allows Calavo shareholders to participate in potential value creation at the combined company.

About Mission Produce NASDAQ: AVO

Mission Produce, Inc is a leading global supplier, packer and distributor of fresh avocados, serving retail, foodservice and industrial customers. The company manages a vertically integrated supply chain that spans sourcing, post-harvest handling, packing and ripening. Through proprietary ripening technologies and cold-chain logistics, Mission Produce delivers consistent quality and extended shelf life for its avocado offerings.

Founded in 1983 and headquartered in Oxnard, California, Mission Produce grew from a regional packing operation into a publicly traded company listed on the Nasdaq under the ticker AVO.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.