It didn't take long for Dole Foods (UNKNOWN:UNKNOWN) to reverse its policy on stock repurchases. Less than three weeks after initiating a buyback program, the company has suspended it. Instead, it will plow capital into upgrading its fleet of ships, a project it anticipates will cost roughly $165 million.
Earlier this month, Dole Foods' board authorized the buyback of up to $200 million of the company's common stock.
The firm cited the age of its current fleet as a key reason for the shift in capital spending priorities. It quoted its CEO C. Michael Carter as saying that the vessels being phased out "will be 27 years old at the time of replacement. The new ships will be more fuel efficient and will be built to Dole's exacting specifications and design."
The company anticipates that it will begin to take delivery of the new ships in late 2015 or early 2016.
Fool contributor Eric Volkman has no position in Dole Foods, and neither does The Motley Fool. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.