DLM Overview

Based out of San Francisco, California, Del Monte Foods (DLM) is one of America’s largest food producers and distributors in business today. The history of the company dates back to the late 19th and early 20th centuries.

Beginning in the 1870s and 1880s, California was becoming the nation’s leading producers of fruits and vegetables within the expanding country. Just before the turn of the century, eighteen of California’s largest canneries merged to form one expansive organization, the California Fruit Canners Association (CFCA).

The organizations leading member, George Newell Armsby, was a well-to-do entrepreneur that led several corporations to merge in the early 20th century. In regards to Del Monte, Armsby was responsible for the CFCA adding two additional canning companies to their association, which would then become the California Packing Corporation, or Calpak.

At this time, 1916, Calpak would begin marketing their products under the Del Monte brand, thus instituting the company into America’s marketplace. It did not take long for the company to prosper. Within the first year of incorporation, Calpak would expand to operate more than 60 canneries, which included several in Utah, Idaho, Washington, Oregon, California and even Alaska.

Over the next several decades, Calpak would increase their market presence by adding pineapple farmlands and a cannery in Hawaii in the late 1910s. Moving forward into the 1920s, Calpak would add additional canneries in Florida and throughout the Midwest, and even branched out as far as the Philippines.

Post World War II, Calpak had several international operations in facilities that were either purchased or constructed to increase productivity. In lieu of their multinational operations, Calpak changed their name in 1967 to its current name, Del Monte Corporation.

By 1979, Del Monte was acquired by R.J. Reynolds Tobacco Co. (RJR), which would later become RJR Nabisco Inc. In 1989, just ten years after the merger, R.J. Reynolds would sell their fresh fruit business and was renamed Fresh Del Monte Produce (FDP). Although no longer associated with Del Monte, FDP would continue to market bananas, pineapples and produce under the Del Monte label.

Notwithstanding, Del Monte Foods does license their Del Monte brands to Fresh Del Monte Produce. Following the sale of FPD, R.J. Reynolds would later sell the remaining portion of their food procession division, a.k.a. Del Monte, to private investors.

A year before the turning of a new millennium, Del Monte Foods would once again become a publicly traded company. In 2002, Del Monte approached one of the largest U.S. food purveyors, H.J. Heinz Company (HNZ), in an offer to purchase several well-known brands from Heinz in an all-stock transaction that left Del Monte shareholders a 25.5% stake in the company, while Heinz shareholders received 74.5% of the company.

The deal, which nearly tripled the size of Del Monte overnight, left the company with a unique compilation of products.

Today, Del Monte Foods engages in the production, distribution, and marketing of branded foods and pet products within the retail market throughout the U.S. The company currently operates in two very distinct divisions, Consumer Products and Pet Products.

Del Monte sells their products through a company sponsored direct sales force, as well as through independent food brokers. These purveyors sell the company’s products to grocery stores, club stores and mass merchandiser customers. Del Monte also offers their manufactured goods to specialty pet stores, dollar stores, drug stores, convenience stores and to military instillations.

Under their Consumer Products unit, the company sells their items for consumption under the Del Monte, S&W, Contadina, College Inn, Fruit Naturals, SunFresh and Orchard Select brand names. Del Monte also provides private-label products to select customers.

Del Monte provides their customers with such products as canned vegetables, potatoes, fruit, tomato products, including ketchup, tomato sauce, tomato paste, spaghetti and pizza sauces, and College Inn broth products.

The consumer products segment also included the StarKist Seafood unit, which manufactures, markets and sells branded and private-label, shelf-stable tuna products, which include canned and pouched tuna and low-sodium and low-fat tuna. However, in June 2008, the company relinquished their ownership of StarKist to the South Korean company, Dongwon Enterprise Co for just over $360M.

Within the consumer products segment, Del Monte competes with General Mills (GIS), Seneca Foods (SENEA), Signature Fruit Company, Pacific Coast Producers, ConAgra (CAG), Heinz (HNZ)and Campbell Soup (CPB).

As for the company’s other operating segment, Pet Products, Del Monte’s product-line includes such nationally recognized brands as Kibbles 'n Bits, 9Lives, Pup-Peroni and in May 2006, the company acquired Meow Mix, Alley Cat and Milk-Bone brands, adding them to their already extensive list of pet products.

Del Monte competes with Nestle-Purina, Mars, Colgate, Procter & Gamble (PG) and Menu within their Pet Products operations.

By BetterTrades