FRESH DEL MONTE: A Tough Competitor In a Cut-Throat Trade

BY TONY WEST/Appearances to the contrary, Fresh Del Monte Produce, Inc. shares nothing more than a brand name any more with Del Monte Foods, the historic California food packer.

This tropical-fruit operation was spun off as a separate company in 1990, winding up first with Cypriot, then with Mexican owners. The company soon foundered and fell into the hands of the Mexican government.

In 1996, Fresh Del Monte was bought by a Palestinian Ã©migrÃ©, Mohammad Abu-Ghazaleh, who had made a fortune importing bananas to the Middle East. He turned it around and built it into the largest fresh-produce company in the world.

Today, Fresh Del Monte is headquartered in Miami, where 68-year-old CEO Abu-Ghazaleh lives, along with his COO, Hani el-Naffy, who was born in Lebanon. However, the company is incorporated in the Cayman Islands, a Caribbean tax haven. The Abu-Ghazaleh family owns a majority share of the company, which is traded on the New York Stock Exchange. It last reported $145 million in profits on $3.5 billion in revenue.

Abu-Ghazaleh is a prominent Miami socialite; his living-room was featured in an interior-design magazine. El-Naffy tends to shun the limelight. An investment observer said of el-Naffy his â€œMafia don-type management style strikes fear into all that work with him, yet supports and covers his superiorâ€™s mistakes constantly. He does so much more than his title depicts â€¦ I am wary of his impending early retirement and beware of the stock losses when he does.â€

Both Abu-Ghazaleh and el-Naffy are involved in a mareâ€™s nest of other international business ventures revolving around either food or shipping. Wearing another hat, for instance, that of National Poultry PLC, Abu-Ghazaleh is the Frank Perdue of Jordan. Most of these operations are privately held and analysts consider even Fresh Del Monte opaque to outsiders. Abu Ghazaleh stresses close control of operations and has moved everywhere to acquire vertical ownership of production as well as shipping, processing and marketing.

In an often-cutthroat industry, Abu Ghazaleh has a reputation for hard bargaining and ruthless dealing. While he has scored points for environmental awareness, he drives relentlessly to cut labor costs to the bone.Â Several international observers have criticized the company for child labor in Ecuador and intimidation of union organizers in Guatemala. Fresh Del Monte will can a union operation in the blink of an eye.

In 2007, a Fresh Del Monte plant in Oregon was raided by immigration agents, who netted 167 illegal immigrants. However, the company escaped liability because the workers had been hired through a middleman. This is a standard tactic for the company, which has been sued for it in other jurisdictions.

Also in 2007, the company was accused of paying off rightwing paramilitary forces in Colombia, where union leaders on banana plantations on banana plantations have been murdered. Fresh Del Monte has denied such payments.

Accusations of political corruption also coil around Fresh Del Monte. After Abu-Ghazaleh bought the company, some minority shareholders sued him in Miami, charging he had paid a $321,000 bribe to a Mexican government official to force the sale at half its true value. That official, Eduardo Bours, later became Governor of the Mexican State of Sonora, which abuts the Arizona border. The payment was proven, but the lawsuit failed.

However, Marvin Bush â€“ brother of then-President George W. Bush and then-Gov. of Florida Jeb Bush â€“ resigned from the Board of Directors of Fresh Del Monte after the lawsuit was filed, for personal reasons.

Hardball players in a tough industry, both in business and in politics, the Abu Ghazalehs and the Holts share a common outlook.

JOIN OUR NEWSPAPER Join over 3.000 visitors who are receiving our newsletter and learn how to optimize your blog for search engines, find free traffic, and monetize your website. We hate spam. Your email address will not be sold or shared with anyone else.