DiGiorgio Corporation

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DiGiorgio corporation was a fruit-growing corporation and eventual conglomerate in the 20th century. Once a vast company, owning much of California's central valley farm land, and multi-billion dollar corporation, a massive restructuring in the 1990s limited its breadth. DiGiorgio now distributes food products under its White Rose brand name to New York, New Jersey and Connecticut.

Contents

Founding

Joseph DiGiorgio (born Giuseppe DiGiorgio, 1874 in Cefalu, Sicily) immigrated to the United States in 1888, becoming a middleman for fruit sales. He founded the Baltimore Fruit Exchange in 1904 on borrowed money and in 1911 was able to purchase the Earl Fruit Company, a California shipper. In 1919, he was able to purchase 5,845 square miles (15,100 km2) of land outside Arvin in California's San Joaquin Valley. A year later, DiGiorgio founded DiGiorgio Fruit Co. His success came when he obtained water for the arid California land by drilling wells hundreds of feet deep. By 1929, just ten years after his original land purchase, DiGiorgio's company was the largest fruit-packing plant in the nation.

Growth

The end of Prohibition in 1933 saw DiGiorgio venture into the winery business, forming Del Vista Wine Co. By 1946, the company occupied 33 square miles (85 km2) of the San Joaquin Valley as well as land as far north as Marysville and south to the Mexican border. It was the largest grape, plum and pear grower in the world. Its revenue rose from $5.7 million in 1938 to $18.2 million in 1946, with DiGiorgio and his family owning 59% of the stock.

Early setbacks

The shrinking water table eventually forced DiGiorgio Co. to request federal irrigation water. However, it was disqualified by the US Bureau of Reclamation, which restricted its services to owners of less than 160 acres (0.65 km2).

Ernesto Galarza also targeted DiGiorgio Co., organizing a strike from 1947–50 and a boycott of the company's products. The strike lasted 30 months[1]. Even though DiGiorgio's workers were amongst the most satisfied with their jobs amongst any farming corporations at the time, DiGiorgio Co. signed a contract with the United Farm Workers in 1966, ensuring fair wages.

Change in Leadership & Diversification

Joseph DiGiorgio died in 1951 and his nephew, Robert DiGiorgio rose to leadership, becoming president in 1962. By 1967, the agricultural portion of the business accounted for less than 2% of revenue and "Fruit" was dropped from the company's name. Its acquisitions included S&W Fine Foods, TreeSweet, White Rose, Serv-A-Portion (distributor of condiment packets for fast food), Los Angeles Drugs, Peter Carando Inc (Italian-style meats), Sun Aire Airlines and Las Plumas Lumber Co. DiGiorgio also became invested in land development across California. Investments and directorships gave the company close ties to Bank of America (then Bank of Italy), Pacific Gas & Electric and Southern California Edison. In 1965, assets had reached $82.9 million and sales had passed $100 million. DiGiorgio Co. ranked 9th in rate of sales growth in the nation at that time. Its products and services ranged from grocery distribution, fruit juices, campers, lumber, housing components, pharmaceuticals, wine and, of course, fruit. Exports were mainly to Europe and Japan.

Decline

By the late 1970's, DiGiorgio's sales reached $1 billion. However, net earnings were down due to large amounts of debt. The company was seen to lack focus. Peripheral companies were sold off and many of the shareholders were uneasy about the companies future as Robert DiGiorgio grew old, eventually stepping down as chairperson in 1982 and turning the company over to Peter Scott. Restructuring began in 1984. Sun Aire was sold to SkyWest Airlines. TreeSweet, Allied Distributing Co., Los Angeles Drug Co. and much of the real estate outside of Borrego Springs was sold as well. The late '80s saw hostile takeover attempts by the Gabelli Group Inc. In 1988, management enacted a $70 million, $21-a-share buyback offer. However, in doing so, it left DiGiorgio only two lines of business: food processing/distribution and building materials. Trial lawyer and New Jersey native Arther Goldberg attempted to gain control of the remains, interested in speculative profits. By 1990 he had taken control of the company, moving the headquarters from San Francisco to Somerset, New Jersey. All but White Rose division were eventually sold off by 1994.

Legacy

While the White Rose Company still exists, no other companies carry the DiGiorgio label. However, DiGiorgio a town in the San Joaquin Valley still bears the name of the once vast farming empire. The DiGiorgio family stayed connected with its homeland, donating large amounts of money to Cefalu, Sicily. In the small, oceanside town, one can find both a "DiGiorgio Technical Institute" and "Plaza DiGiorgio."

References

http://www.fundinguniverse.com/company-histories/Di-Giorgio-Corp-Company-History.html

Ruth Teiser "The DiGiorgios: From Fruit Merchants to Corporate Innovators." The Regents of the University of California. 1986