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Diving overview:
- Mission Produce is purchasing rival Calavo Growers in a deal that combines two of North America’s largest avocado companies.
- The cash-and-stock transaction, expected to be completed by the end of August, values Calavo at $430 million. In addition to avocados, Calavo sells guacamole and dips under its own brand or through private labels and food service providers.
- This transaction will allow Mission to expand within the prepared foods sector and grow internationally. The addition of Calavo also diversifies Mission’s produce portfolio to include tomatoes and papaya.
Dive Insights:
The addition of Calavo gives Mission the opportunity to diversify its business by adding new produce to its portfolio while also entering the prepared foods segment with ready-to-eat guacamole, a high-growth category.
The global avocado processing sector is valued at $2.7 billion in 2025 and is expected to experience a compound annual growth rate of 8% through 2033, according to a mission presentation on the deal.
“With this acquisition, we are expanding our premium avocado presence in North America and working to build a leading global fresh produce platform, which we believe will be well-positioned to capture the growing demand for fresh, healthy and convenient foods,” John Pawlowski, Mission’s chief operating officer and new CEO, said in a statement.
Combining the two avocado suppliers would create a company with net sales of more than $2 billion. This will also solidify Mission as the nation’s leading avocado supplier with a path to international expansion.
Demand for produce and other products in grocery store fresh food departments has surged as consumers prioritize quality, convenience, and healthy foods. According to FMI, Foodservice will achieve a record $56 billion in sales in 2024. Additionally, 42% of grocery store sales in 2024 will come from the fresh category, including produce and meat.
In addition to new sales opportunities for Mission, the companies estimate the transaction will result in annual cost synergies of $25 million. These savings will come at a time when the avocado industry as a whole is facing declining profits and supply is recovering following a prolonged shortage.
For example, Mission’s fourth quarter sales were down 10% compared to the previous year. This decline occurred because the 13% increase in volume growth was not enough to outweigh the 27% decline in prices.
Falling avocado prices also pressured Calavo’s profits, with fourth-quarter sales in its fresh segment down 31% from a year earlier. Calavo is struggling with unique headwinds, including a now-suspended Justice Department investigation into foreign bribery allegations and the closure of a temporary facility for pest treatment.
B. John Lindeman, president and CEO of Calavo Growers, said in a statement that joining Mission better positions the brand to “invest, innovate and serve the market at scale.”
“We believe that our combination with Mission Produce represents a strong next chapter that will allow the combined business to drive new growth and expand the impact of the trusted Calavo brand, while providing our shareholders with compelling value and the opportunity to participate as shareholders of a global leader in a growing sector.”
Calavo has 2,000 global employees with a product mix that primarily focuses on avocados and guacamole, although it also includes tomatoes and papaya. Mission recently expanded its produce offerings by entering the blueberry and mango markets.
