Pilgrim's Pride files for bankruptcy
Pilgrim's Pride Corporation filed for Chapter 11 bankruptcy Monday.
Pilgrim's Pride, which employs more than 2,000 people in Franklin County, has struggled financially since purchasing Gold Kist Poultry in 2006.
According to a company statement, officials expect to continue operations as normal throughout the bankruptcy process while developing a reorganization plan to resolve its temporary operational and liquidity issues. No immediate layoffs are expected locally, officials said.
"Over the past year, Pilgrim's Pride has faced a number of significant challenges including high feed-ingredient costs, an oversupply of chicken, weak market pricing and softening demand," said Clint Rivers, president and chief executive officer.
"After careful consideration of all available alternatives, the company's board of directors determined that a Chapter 11 filing was a necessary and prudent step and the best way to obtain the financing necessary to maintain regular operations and allow for a successful restructuring."
Pilgrim's Pride is seeking approval to enter into a $450 million debtor-in-possession financing facility arranged by Bank of Montreal as lead agent. If approved by the court, the financing will provide an immediate source of funds to the company, enabling it to satisfy the customary obligations associated with the daily operation of its business, including the timely payment of employee wages and other obligations.
"We expect to emerge from this restructuring a stronger, more competitive company that is well positioned for growth and enhanced profitability," Rivers said.
"We are proud of the consistently high quality of our products, our valued customer relationships and the high level of service we provide."
Rivers said the company does not plan any closings or layoffs at this time.
"I'd like to emphasize that we expect it will be "business as usual" as we work through this restructuring process. We remain steadfast in our commitment to rebuilding our business and maintaining our core values."
During the Chapter 11 process, suppliers should expect to be paid for post-petition purchases of goods and services in the ordinary course of business.
The company laid off nine people at the Russellville plant last month as part of a nationwide restructuring plan that eliminated 350 jobs.